Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

METROPOLITAN WATER BOARD BILL [Lords]

UNIVERSITY OF BRADFORD BILL [Lords]

NEW QUAY URBAN DISTRICT COUNCIL BILL [Lords]

Read the Third time and passed, with Amendments.

SOMERSET COUNTY COUNCIL BILL [Lords]

As amended, considered; to be read the Third time.

Oral Answers to Questions — NATIONAL FINANCE

Sterling (Floating Exchange Rate)

Mr. Biffen: asked the Chancellor of the Exchequer if he will commission a study to determine the advantages of a floating exchange rate for sterling.

The Chancellor of the Exchequer (Mr. .fames Callaghan): No. Sir.

Mr. Biffen: Is not the Chancellor aware that there are ominous signs of our yet again running into balance of payments problems, and, further, is he aware of the widespread and substantial advocacy by many non-party people that a floating rate of exchange is one way of curing the endemic sterling crises?

Mr. Callaghan: I am aware that a number of people feel that, but it is not the policy of the British Government.

Private Investment Overseas

Mr. Sheldon: asked the Chancellor of the Exchequer what action he is taking to reduce the level of private United Kingdom investment overseas.

Mr. Dickens: asked the Chancellor of the Exchequer what further steps he proposes to reduce the level of private United Kingdom investment oversea.

Mr. Callaghan: The Government's policy is to reduce the cost to the balance of payments of private investment abroad has been implemented by measures under the Exchange Control Act, the Control of Borrowing Order, and the voluntary programme introduced in 1966. In addition, the establishment of the Corporation Tax system will exert a growing and permanent influence in this field.
These measures are working satisfactorily. I have no present proposals for further restriction.

Mr. Sheldon: Does my right hon. Friend recall that in last year's Budget statement he spoke of certain proposals whereby the return on investment would need to come within a period of two or three years? Will he now say how these stringent tests are being applied at present, and how successful they are?

Mr. Callaghan: There is evidence of their success and their value in determining the real return to us. The figures show a net disinvestment overseas in each of the past three years, and that continued in the first quarter of 1967.

Mr. Dickens: Is my right hon. Friend aware that the outflow of £432 million of direct private investment, including oil, from this country abroad in 1966 was about £35 million higher than in the crisis year 1964? Will he reconsider his decision not to impose further restrictions on the outflow of direct private investment abroad, quite apart from the question of disinvestment or reinvestment or the question of the inflow of private capital to this country?

Mr. Callaghan: No, Sir. It is possible to select various indices, but, to take the general one which enters into the balance of payments, it shows a decline from 1964 to 1966 in the following


terms: minus £405 million; minus £356 million; minus £315 million—a diminution in each year—and for the first quarter of 1967, minus £73 million.

Mr. Patrick Jenkin: The right hon. Gentleman referred to the Corporation Tax. Does not he recognise that what the Government have done is clean contrary to what the Reddaway Report suggested would be appropriate, that is, they have imposed long-term disincentives and have alleviated this by a few short-term palliatives?

Mr. Callaghan: The Reddaway Report did not support the view that there should be a continuing unrestricted outflow of investment from this country, and I know of no one who suggests it.

Tax System (Simplification)

Mr. Sheldon: asked the Chancellor of the Exchequer what studies he is making of the simplification of the tax system.

The Financial Secretary to the Treasury (Mr. Niall MacDermot): I would refer my hon. Friend to the answer I gave on 7th March to the hon. Member for Chelmsford (Mr. St. John-Stevas).—[Vol. 742, c. 1239–40.]

Mr. Sheldon: Is my hon. and learned Friend aware that there are pressures to increase the complexity of taxation to march hand in hand with the increasing complexity of industry, and will he do his utmost to resist these pressures, realising that it takes a great amount of energy in these matters just to stand still?

Mr. MacDermot: Every year, on the Finance Bill, Treasury Ministers spend a large part of their time resisting pressures for adding to the complexity of our tax system.

Tax Relief (Spastic Children)

Mr. Eadie: asked the Chancellor of the Exchequer what representations he has received from organisations and individuals asking for additional tax relief to the parents of spastic children, and what reply he has sent.

Mr. MacDermot: I know of no representations apart from a letter from my

hon. Friend about a particular case, to which I replied on 19th May.

Mr. Eadie: Some tax dispensation to the parents of these children would be greatly appreciated. Will not my hon. and learned Friend give favourable consideration to it?

Mr. MacDermot: It is a matter on which we all have sympathy, but the difficulties were discussed in a debate on a new Clause on the Finance Bill this year, on 15th June last, to which I refer my hon. Friend.

Purchase Tax

Sir J. Gilmour: asked the Chancellor of the Exchequer whether he will vary the provision of Purchase Tax under Group 11(a) of the First Schedule of the Purchase Tax Act, 1963, so as to exempt school desks from the payment of Purchase Tax even if they do not have holes bored in them for ink-wells.

Mr. MacDermot: No, Sir. The tax on furniture is confined to articles of a kind used for domestic or office purposes. Desks specialised for school use are not taxable, even if they have no ink-well holes.

Sir J. Gilmour: I thank the Minister for that reply, but is he aware that it is in great conflict with the information sent to me by my local education authority, which said that there was insistence that the holes must be bored if Purchase Tax was not to be paid?

Mr. MacDermot: It may be that in the case of the particular desks it was suggested that they would pass the test if some ink-well holes were bored in them, but there are other ways of making desks specialised for school use.

Public Expenditure

Mr. Boyd-Carpenter: asked the Chancellor of the Exchequer what action he has now taken to curtail public expenditure in 1968–69.

Mr. Callaghan: The Government are examining forecasts of Departmental expenditure in 1968–69 as well as in later years in the course of the scrutiny of public expenditure programmes to which I referred in my Budget statement.—[Vol. 744, c. 989–92.]

Mr. Boyd-Carpenter: Surely, if the Chancellor is to convince anybody that he is going to take effective steps to curtail expenditure in the next financial year he must already have reached some decisions? Is the only reason for not disclosing them his desire to get the House up before he does so?

Mr. Callaghan: I doubt whether anything I say will ever convince the right hon. Gentleman who asked the Question. He will know from his past experience that the examination of Departmental Estimates is now taking place, and will no doubt reach its fruition during the autumn months.

Mr. Barnett: Will my right hon. Friend confirm or deny reports that the decisions are being taken and are not to be announced in a comprehensive form? Should he perhaps consider issuing a White Paper setting out the various alternatives, so that the House can come to an informed view based on the facts and figures of the situation?

Mr. Callaghan: No, Sir. It is not my responsibility to confirm or deny statements in the newspapers, but I see no reason to depart from the normal manner of examination of the Estimates.

Mr. Iain Macleod: The Chancellor will be aware from the two supplementary questions from each side of the House of the anxiety in this matter. Will he or will he not make a statement in the House on public expenditure before the House rises?

Mr. Callaghan: I should have thought that it was highly unlikely, because the process of Departmental examination of Estimates for 1968–69 will certainly not be completed by that time.

Mr. William Hamilton: Is my right hon. Friend aware that he will get unanimous support on this side of the House if the bigger proportion of the reduction in public expenditure is in defence rather than the social services?

Mr. Callaghan: Yes, Sir. I am aware that there is a feeling that our defence commitments are too heavily stretched. But I am not altogether convinced that the operation on which I am engaged in examining the Estimates will result in cutting expenditure. It is more a case

of how far it shall be allowed to grow, and the Government took a decision in February, 1965, that it should grow at 4¼ per cent. per annum. That broadly remains the Government's policy.

Sir G. Nabarro: The Question relates to public expenditure. Did the Chancellor of the Exchequer deliberately refer to Departmental expenditure in his reply in order to exclude the crass extravagance of the nationalised industries, which come within the ambit of public expenditure but not of Departmental expenditure?

Mr. Callaghan: No, Sir. There was no deliberate omission. It is well known that the nationalised industries are now making a reasonable return on capital employed, and there is absolutely no justification for the hon. Gentleman's strictures.

Mr. Iain Macleod: Would the Chancellor clear up a most important statement he has just made? He said that the Government's intention was that public expenditure should rise by about 4¼ per cent. per annum. But that was based on growth projections which have now been abandoned by the Government. Do we understand that it still remains?

Mr. Callaghan: There is no particular connection between the growth rate—[An HON. MEMBER: "There ought to be."]—it is a matter of political philosophy whether there ought to be. There is no particular connection between the growth in public expenditure and the growth in the national product. One may be either faster or slower according to the political philosophy involved.

Valuations (Land Levy)

Mr. Boyd-Carpenter: asked the Chancellor of the Exchequer what directions were given to district valuers of the Inland Revenue as to the effect on valuations prior to 5th April, 1967, of the coming into operation on that date of the land levy under the Land Commission Act.

Mr. MacDermot: None, Sir.

Mr. Boyd-Carpenter: Does the Answer mean that the Minister envisages that valuers were not directed to anticipate the coming into effect of the tax?

Mr. MacDermot: No direction was given either way. Valuers were, of course, fully informed about the levy and, in so far as any anticipation would affect the market value at the time, they would take it into account.

Selective Employment Tax

Mr. Stratton Mills: asked the Chancellor of the Exchequer if he will make a statement on the effect of the Selective Employment Tax on the cost of living.

Mr. MacDermot: I estimate that the effect has been to raise the retail prices index by about one-half of 1 per cent.

Mr. Stratton Mills: Surely the Treasury must be most concerned that the tax has a growing effect on the cost of living over the next year to 18 months? Would the Minister consider getting the Prices and Incomes Board to undertake a study of the effect on the cost of living of this ridiculous tax?

Mr. MacDermot: I should have thought that this figure shows how much hon. Members opposite inflated and exaggerated the effect of the tax upon the cost of living.

Mr. Robert Cooke: , Has the Minister any figures of those who are drawing unemployment benefit because their jobs have disappeared because of the incidence of the tax?

Mr. MacDermot: No, Sir, and I should be very interested to receive any figures which the hon. Gentleman has.

Sir J. Rodgers: Is the Minister aware that the number of people employed in manufacturing industries has gone down by about 300,000, although the object of the exercise was to increase the numbers of people in manufacturing, particularly of exports?

Mr. MacDermot: It was not the object to achieve that in the short term. I am confident that the Selective Employment Tax will make its contribution to that objective in the long term.

Mr. Ridley: asked the Chancellor of the Exchequer whether he has considered the recommendations of the Economic Development Council for the distribution trades that nationalised industries should not receive the refund

under the Selective Employment Payments Act in respect of electrical contracting staff; and what reply he has sent.

Mr. MacDermot: Earlier this year this Economic Development Council recommended a review of the decisions in respect of staff of nationalised industries, but it made no specific proposals in respect of electrical contracting staff.

Mr. Ridley: What is the point of setting up these development councils if the Government are not going to take any notice whatever whenever they make recommendations which are politically inconvenient to the Government

Mr. MacDermot: As I indicated in my original reply, the hon. Gentleman is mistaken in thinking that the Economic Development Council made a recommendation and we ignored it.

Australia (Double Taxation Agreement)

Mr. Onslow: asked the Chancellor of the Exchequer what improvement in the liability for taxation of British war widows resident in Australia is expected to result under the new double taxation agreement now being discussed between Her Majesty's Government and the Australian Government.

Mr. MacDermot: Discussions about a new agreement are in progress and I cannot make any statement at present.

Mr. Onslow: Is the Minister aware that as matters stand, and because war widows' pensions are exempt from tax in Australia, British war widows living there and Australian war widows living here both have to pay British tax? Would he do something to remove this anomaly or allow the Australians to introduce a token tax so that they can achieve their purpose?

Mr. MacDermot: I am aware of the matter, and must ask the hon. Gentleman to await the outcome of the negotiations.

London Airport (Documentation and Control of Imports)

Mr. Onslow: asked the Chancellor of the Exchequer what decision he has reached concerning the participation of


Her Majesty's Customs in the proposed Scheme for the installation of electrical data processing facilities for air freight at London Airport, Heathrow; and if he will make a statement.

Mr. Hastings: asked the Chancellor of the Exchequer what progress has been made in the discussions being held by Customs and Excise about the installation of data processing equipment for freight handing at London Airport.

Mr. MacDermot: A joint group representing Customs and airlines has drawn up a technically feasible scheme for applying modern computer methods to the documentation and control of imports at Heathrow. The views of other interested parties are now being ascertained, and the financial and management aspects of the scheme are being examined.

Mr. Onslow: Does the Minister understand the importance of pressing ahead with the scheme, which is most valuable and the initiative for which came from the airline side? Is he aware that it should save the Customs several hundred employees and greatly expedite the handling of imports and exports by air?

Mr. MacDermot: I am well aware of both the potentialities and the urgency of the scheme.

Mr. Hastings: Is the Minister also aware that the French Government have apparently taken a decision to install a .similar system at Orly which will be in operation as early as 1970, and will it not raise possibilities of sales of hardware and "know-how" as long as we press ahead as fast as possible? Has the Minister any comment on that?

Mr. MacDermot: The target date for the scheme referred to in the Question is also 1970.

Tax Revenue (Collection Costs)

Mr. Ridsdale: asked the Chancellor of the Exchequer, what is the present annual cost of collecting all forms of tax revenue.

Mr. MacDermot: About £115 million, or just over 3d. for every £1 of net revenue.

Mr. Ridsdale: Does the figure include all the work done by individuals filling up a whole host of tax forms, and by chartered accountants and others trying to avoid taxation?

Mr. MacDermot: No, Sir. This is the cost to the Exchequer.

Decimal Currency (Scottish Banknotes)

Mr. Dempsey: asked the Chancellor of the Exchequer what are Her Majesty's Government's proposals, after the introduction of decimal currency, for the printing of Scottish banknotes by the Scottish banks; and if he will make a statement.

Mr. MacDermot: No, Sir. I see no reason to change the current arrangements for the printing of notes by the Scottish banks.

Mr. Dempsey: Do I take it that Scottish banks will continue to print notes and that they will be part of the decimal system when it is introduced? Can my hon. and learned Friend say if he will take advantage of the situation to make Scottish banknotes legal tender?

Mr. MacDermot: On the first point, there is no reason for decimalisation in any way to affect the right of Scottish banks to issue their own notes. On the question of making Scottish notes legal tender, I can only refer my hon. Friend to the answers I gave him the last time he raised the matter.

Earl of Dalkeith: Is the Minister aware that people in Scotland will generally welcome the decision to allow Scottish banknotes to go on being printed, and that as long as the Government adhere to the £ basis for the decimal system this should have no effect on the position?

Mr. MacDermot: I quite agree.

Economic Forecasts

Mr. Bruce-Gardyne: asked the Chancellor of the Exchequer if he will now publish a revised short-term economic forecast in the light of the failure of exports to rise and unemployment to stabilise as previously forecast.

Mr. Callaghan: No, Sir.

Mr. Bruce-Gardyne: Will the Chancellor subscribe to the philosophical proposition that the combination of stagnating exports, rising imports and rising unemployment suggests a prima facie case for adjustment of the exchange rate? If not, what condition would he regard as indicating the need for devaluation?

Mr. Callaghan: I see no occasion—if the hon. Gentleman is hinting that we should devalue—for the British £ to be devalued. The slackening in exports at the moment is not due to any result of failure of competitive power on the part of the British economy but to slowing down in the growth of world trade, particularly in Germany and the United States. I am glad to say that my current discussions with the Finance Ministers in London show that they believe that there is an indication that trade in both their countries is likely to resume a faster pace towards the end of this year.

Balance of Payments Surplus

Mr. Bruce-Gardyne: asked the Chancellor of the Exchequer what is his latest estimate of the overall balance of payments surplus in 1967 after allowing for the year-end payments in respect of the post-war United States of America and Canadian loans.

Mr. Callaghan: I would refer the hon. Gentleman to my reply to my hon. Friend the Member for Newark (Mr. Bishop) on 4th July.—[Vol. 749, c. 217–8.]

Mr. Bruce-Gardyne: Would the right hon. Gentleman say whether he still expects a massive surplus in 1968? Can he also confirm that his target of 3 per cent. growth rate year in year out has been postponed in the current year?

Mr. Callaghan: I have never used the word "massive" and so I see no reason to take responsibility for it. I still see the prospect of a substantial balance of payments surplus in 1968. [HON. MEMBERS: "Answer the question."] That is the question that I was asked. The hon. Gentleman asked me whether I could foresee a massive surplus in 1968. I am replying that I have never used the term "massive", but I can still see a substantial surplus in 1968. As to the question of growth rate, as far as I can see the growth rate will continue broadly on course as we expect.

Mr. Stratton Mills: Will the right hon. Gentleman deal with the point as to whether he expects, as he has already forecast, a surplus on balance of payments for 1967? Is he aware that he has got the forecast wrong for three different years and that overseas opinion has very little confidence in his forecasting accuracy?

Mr. Callaghan: I do not know that anybody has any confidence in forecasting the balance of payments. That is why, as is the case throughout the world, I do not publish forecasts. As to this year, we had a healthy surplus in the first quarter. The present position is made more complex by the Middle East situation, and I am not able to forecast how this is likely to develop in the coming months.

Mr. Bruce-Gardyne: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of the reply, I beg to give notice that I shall raise the matter on the Adjournment.

Foreign Travel Allowance

Mr. Hunt: asked the Chancellor of the Exchequer why he has decided to retain the limit of £50 for the foreign travel allowance for 1967–68.

Mr. Stratton Mills: asked the Chancellor of the Exchequer if he will make a statement on his decision to retain the limit of £50 for the foreign travel allowance in 1967–68.

Mr. Goodhart: asked the Chancellor of the Exchequer when he expects to increase the limit of £50 for overseas travel.

Mrs. Renée Short: asked the Chancellor of the Exchequer for what reasons he decided to continue the limit of £50 on foreign travel allowance for the year 1967–68.

Mr. Callaghan: I would refer my hon. Friend and the hon. Gentlemen to the Answer given to the hon. Member for Worcestershire, South (Sir G. Nabarro) on 29th June, 1967. This restriction is making a useful contribution to the recovery of our balance of payments.—[Vol. 749, c. 123.]

Mr. Hunt: Does not the right hon. Gentleman realise that this petty and


foolish decision means that British holiday-makers abroad are being ridiculed and regarded as the poor relations of Europe? How much longer is the Chancellor going to cling to a policy which combines the minimum of savings in foreign exchange with the maximum of irritation and inconvenience to everybody concerned?

Mr. Callaghan: I do not accept this. I recognise that any limitation on foreign travel allowance is an inconvenience, but if it is likely to make a substantial saving in foreign exchange during the course of the year it seems to me that it is an inconvenience that it is my responsibility not to allow to go by. As to the adequacy of the allowance, I think it is still true that the average person who goes abroad and is entitled to £50 plus £15 in sterling notes and £25 if he takes a car finds it possible to have a holiday in reasonable comfort.

Mr. Goodhart: Does the Chancellor realise that a Rhodesian citizen may have a travel allowance of £100? If we are doing so well financially, why are we more heavily restricted than Rhodesians are?

Mr. Callaghan: Perhaps more Rhodesians wish to leave their country.

Mr. Stratton Mills: Has the right hon. Gentleman any figures in respect of the increased amount of holidays taken in the overseas sterling area, which is an equal drain on the balance of payments, and are not people going on their holidays there because of these miserable restrictions?

Mr. Callaghan: Yes, Sir; I have some estimate, but as we are in the middle of the holiday season I do not think it would be helpful to the House to give figures. The hon. Gentleman would be the first to criticise me if they were found to be inaccurate in any way. Clearly, the net balance of payments effect is not as great as the saving of foreign exchange but it is the foreign exchange element of the balance of payments which is of significance.

Sir G. Nabarro: On a point of order Mr. Speaker. Is my Questions No. 29 on the travel allowance being answered with this mass of Questions?

Mr. Speaker: Apparently not.

Mr. Barnett: Is my right hon. Friend aware—

Mr. Ridley: On a point of order, Mr. Speaker. Did the Chancellor answer Question No. 37?

Mr. Speaker: The right hon. Gentleman did not answer that Question. These questions are wasting Question Time.

Mr. Barnett: Is my right hon. Friend aware of the widespread abuse as a result of the very marginal use made of the business foreign travel allowance? Would he not think it worth making it more equitable by allowing the concession to carry forward so that any not used one year could be used the next?

Mr. Callaghan: I think that that is dealt with by another Question on the Order Paper.

Mr. Barnett: asked the Chancellor of the Exchequer if he will permit all or any part of an individual's foreign currency allowance not used in one year to be carried forward to the next.

Mr. MacDermot: No, Sir.

Mr. Barnett: I apologise, Mr. Speaker. I thought that this Question had been taken with a previous Question. May I, therefore, say "ditto" in respect of the supplementary question that I put to my right hon. Friend just now?

Mr. Speaker: Order. An hon. Member should not anticipate a Question of his own.

Mr. Barnett: On a point of order, Mr. Speaker. I asked a supplementary question earlier of the Chancellor, and he said that he would deal with it, presumably on a later Question. May I ask him whether he will now deal with it?

Mr. MacDermot: It has never been the practice when there has been a controlled travel allowance to allow a carry-forward, and to do so would give many people an additional allowance to spend in the following year and reduce the expected savings.

Mr. Onslow: Is the hon. and learned Gentleman aware of the very great damage done by the present restrictions to British airlines, both nationalised and independent ones, and would not a slight


extension of this kind be of marginal help to them?

Mr. MacDermot: If any such action were required I do not think that this would be the way to do it.

Mr. Kenneth Lewis: asked the Chancellor of the Exchequer whether the £50 foreign currency restriction applies to Ministers' wives when travelling abroad with Ministers on official business.

Mr. MacDermot: Yes, except when a wife is travelling at public expense, in which case she is entitled to a personal allowance from her own moneys of up to £2 a day or £10 a week, whichever is the less.

Mr. Lewis: Is the hon. and learned Gentleman aware that I have no objection to a Minister taking his wife with him on limited occasions when it is necessary in the national interest, in the same way as businessmen can take their wives on limited occasions, but, in view of the sacrifices being asked from the general public, should not there be a reduction in the number of these occasions and should not part of the £50 allowance be used as an extra contribution above what would be considered to be reasonable?

Mr. MacDermot: The question of a reduction in the number of these occasions is a matter for my right hon. Friend the Prime Minister, to whom the hon. Gentleman should direct his question. In the amount of the allowance made available in such cases, we are following the precedent of what is allowed in other, similar cases.

Sir G. Nabarro: asked the Chancellor of the Exchequer what further information he now has concerning the saving in foreign exchange resulting from the £50 limit for British travellers outside the sterling area during 1966–67 travel year; and what is his estimate of such saving during the new travel year commencing 1st November, 1967.

Mr. MacDermot: On the current travel year, I would refer the hon. Gentleman to my speech in the Adjournment debate on 19th June. I expect that the limit will continue to procure a useful saving in the coming year.—[Vol. 748, Col. 1085–90.]

Sir G. Nabarro: For the umpteenth time, may I ask the hon. and learned Gentle-

man how he arrives at his choice of words, "a useful saving", when he has no available statistics, on his own confession, to support that choice of words? Again, will he avoid side-stepping until 23rd October and give the House a truthful answer?

Mr. MacDertnot: For the reasons I gave the hon. Gentleman in an Adjournment debate, there is plenty of evidence that we are making a saving running into many millions of pounds.

Mr. Boyd-Carpenter: Has the hon. and learned Gentleman considered the powerful argument by the former Governor of the Bank of England, Lord Cromer, in a recent letter to The Times, to the effect that this restriction was not resulting in substantial savings to the balance of payments? Will not the hon. and learned Gentleman pay attention to such advice from one who has served the Government very well indeed?

Mr. MacDermot: I read that letter with considerable surprise. I would have thought that Lord Cromer would have been the first to recognise the importance of our giving absolute priority to our balance of payments.

Mr. Frank Allaun: Will my hon. and learned Friend note the experience of travel agencies—which is that, to ordinary people, this does not matter a damn, since they can take £130 for a couple, plus £30 in cash, which is quite enough for any reasonable couple?

Mr. MacDermot: I would not adopt my hon. Friend's choice of language but I certainly agree with his sentiment. The area in which we are expecting to get the saving is among the 25 per cent. of the travellers who spend over 50 per cent. of the foreign exchange.

Mr. Ridley: asked the Chancellor of the Exchequer for what period of time is the permission for the £50 travel allowance valid.

Mr. MacDermot: Any unused foreign exchange must be turned back into sterling within one month of the date of issue or immediately on return to this country if that is later.

Mr. Ridley: If we are to have rationing, just as we had rationing of practically every other commodity under the


previous Socialist Government, could we not at least have an entitlement, a ration card, for the travel allowance so that those who did not want to use their ration in one year or in one month could use it in future?

Mr. MacDermot: As I have explained, it cannot be used in another year but can be used in another month in the same year, and returned moneys can be credited in the traveller's passport.

Mr. Charles Morrison: asked the Chancellor of the Exchequer what special travel allowance he intends to allow for British visitors to the Olympic Games in Mexico City in 1968.

Mr. MacDermot: My right hon. Friend has received representations on this subject and is considering them.

Mr. Morrison: Could the hon. and learned Gentleman make sure that an announcement will be made in adequate time for people to make plans for visiting the Olympic Games if they decide to do so?

Mr. MacDermot: Yes. We will have regard to that.

Rhodesia (Sanctions)

Mr. Wall: asked the Chancellor of the Exchequer what is the estimated total cost direct and indirect to the British economy of the campaign of sanctions since Rhodesia's declaration of independence.

Mr. MacDermot: The direct cost to the Exchequer for the period from I.D.I. to 30th June is now estimated to be about £23 million.
With regard to the cost to the balance of payments, I would refer the hon. Gentleman to the Answer my right hon. Friend the Chancellor gave on 7th March and to that given by my right hon. Friend the Prime Minister on 16th March.—[Vol. 742, c. 1232–4; Vol. 743, c. 151–2.]

Mr. Wall: Would the hon. and learned Gentleman reply to the Question on the Order Paper, which asks what the total effect is on the British economy, including visibles and invisibles? Would he not agree that it is now between £100 million and £150 million?

Mr. MacDermot: I have given the figures of the direct cost of the effect on the Exchequer, of which we are able to make precise estimates.

Gold Coins

Mr. Higgins: asked the Chancellor of the Exchequer whether he will bring up to date the figure of £100,000, which at 22nd November, 1966, represented sales of gold coins under Statutory Instrument 1966, No. 438, to the five members of the London gold market.

Mr. MacDermot: I would refer to the Answer given to the hon. Member for Essex, South-East (Mr. Braine) on 23rd June, 1967.—[Vol. 748, c. 358–9.]

Mr. Higgins: As there has been no change since that date, can the hon. and learned Gentleman tell us what has been the effect on the balance of payments of the collections made so far?

Mr. MacDermot: The question of the effect on the balance of payments is a separate question of which I should require notice, and I do not think that the hon. Gentleman would want me to revise figures given as recently as 23rd June.

Mr. Higgins: asked the Chancellor of the Exchequer whether the Government intend to continue the practice of not asking the Director of Public Prosecutions, whose consent is necessary, to proceed against those who make voluntary disclosures of gold coins under Statutory Instrument 1966, No. 438.

Mr. MacDermot: Yes, Sir.

Mr. Higgins: Is it not very unsatisfactory? If an Order is being passed through the House, should it not be consistently enforced or else withdrawn?

Mr. MacDermot: We will keep this matter under review. We want still to encourage people who may be holding coins without permission to apply for permission.

Regional Employment Premiums

Mr. Elystan Morgan: asked the Chancellor of the Exchequer if he will cause a survey to be made of localities suffering from acute economic difficulties, with a view to seeking to vary the rate of payment of regional employment premium in those areas.

Mr. MacDermot: I cannot at this stage usefully add to the reply given to my hon. Friend on 21st June.—[Vol. 748, c. 306–7.]

Mr. Morgan: Does not my hon. and learned Friend agree that, once a uniform pattern of assistance is imposed, it will be more and more difficult to have that pattern varied? While over a year has elapsed since the strong suggestion was made that Selective Employment Tax might be varied on a geographical basis, this has not yet come about.

Mr. MacDermot: We have taken power in the Finance Act to make variations of this kind by order if they prove necessary, but we believe that it would be premature, until we have had experience of the effects of the regional employment premium on 'development areas as a whole, to take any action of this kind.

Mr. Wingfield Digby: asked the Chancellor of the Exchequer what representations he has received from the South Western Development Association criticising employment premiums for their effect on the South West Region; and what corresponding measures he now proposes to take to help this area.

Mr. MacDermot: The Association has written to my right hon. Friend about the needs of areas, outside the Development Areas, with above average unemployment and have made various suggestions. The problems of areas such as these will be taken into account in the study by Sir Joseph Hunt's Committee whose terms of reference my right hon. Friend the First Secretary of State announced on 6th July.—[Vol. 749 Col. 275.]

Mr. Digby: Is the hon. and learned Gentleman aware that there is increasing anxiety in the South-West at the way in which its problems are ignored?

Mr. MacDermot: I do not agree that the problems are ignored. We are aware of the anxiety on this matter and, as I have indicated, this question will be considered by Sir Joseph Hunt's Committee.

Nationalised Industries (Capital Requirements)

Mr. Ridsdale: asked the Chancellor of the Exchequer if he will issue general directions to the nationalised industries for which he is responsible to finance capital developments in those in-

dustries in the private investment market, rather than by price increases.

Mr. MacDennot: It has been Government policy for many years that the nationalised industries should borrow long term only from the Exchequer and that the industries should contribute a substantial proportion of their new capital requirements from their own earnings. My right hon. Friend is reviewing nationalised industries' borrowing arrangements but is not yet ready to make a statement on this subject.

Mr. Ridsdale: Is it not iniquitous that old age pensioners and others who cannot afford it should be forced to contribute to expensive capital requirement, such as has happened with the electricity industry, when there has been a 10 per cent. price increase?

Mr. MacDermot: If it is an iniquitous policy, it was laid down by the hon. Gentleman's party when they formed the Government.

Oil Taxation (Revenue)

Sir G. Nabarro: asked the Chancellor of the Exchequer, having regard to his estimated revenue from all oil taxation of £877 million in 1967–68, of which approximately £600 million derives from motorists, what estimate he has made of the short-fall in revenue due to the rationing of oil and petrol after 1st October, 1967.

Mr. MacDermot: No decision to ration petrol or oil has been taken.

Sir G. Nabarro: But the coupons have been printed and as the mileages to be permitted are shown on the coupons, presumably the Treasury is in a position to know how much petrol and oil consumption will be reduced. In the circumstances, would not the hon. and learned Gentleman now answer the Question and not side-step it until 23rd October?

Mr. MacDermot: I have answered the Question. The hon. Member must not complain if he phrases his questions so badly.

Her Majesty's Stationery Office (Purchases)

Mr. William Hamilton: asked the Chancellor of the Exchequer how much of the £26·3 million worth of purchases


made by Her Majesty's Stationery Office in the financial year 1965–66 was incurred in Scotland.

Mr. MacDermot: Of the Stationery Office expenditure of £26·3 million on goods and services, the value of contracts placed in 1965–66 was £22·1 million, of which £2·3 million was incurred in Scotland.

Mr. Hamilton: What consideration are the Government giving to increasing the proportion of Government purchasing power spent in development areas? To many of us, this seems one of the additional mechanisms that could be used by the Government in the development of regional policy planning.

Mr. MacDermot: We are aware of that aspect and opportunities are given to Scottish firms to quote for work required in England and Wales as well as for work required in Scotland. Due regard is paid to the policy when tenders are received from firms in development areas.

Exchange Control (Rhodesia)

Mr. Christopher Price: asked the Chancellor of the Exchequer if he will take action, under exchange control, to prevent the sending of money out of the country to pay for Ian Smith sterling silver medallions.

Mr. MacDermot: Exchange control already prohibits any remittance from this country to Rhodesia for this purpose. If these medals are made in Rhodesia they may not be imported without a specific import licence, which will not be given.

Mr. Price: Is my hon. and learned Friend aware that some of these medallions are being held to the names of purchasers in South Africa? Is it not obvious that this money is passing out of the country for the benefit of the Rhodesian economy? Will he consult the Attorney-General to see what can be done about it?

Mr. MacDermot: If my hon. Friend is suggesting that we should prohibit payments from the United Kingdom to South Africa in connection with these medallions, I can only say that it could not be done without excluding South Africa from the list of scheduled territories, and we have no intention of doing that.

Bank of Rhodesia (Securities)

Mr. Goodhart: asked the Chancellor of the Exchequer whether he will now instruct the directors of the Bank of Rhodesia appointed by the British Government to pay the dividends due to holders of Rhodesia Government securities.

Mr. MacDermot: No, Sir. Her Majesty's Government have no power to give directions of this kind.

Mr. Goodhart: When will the Government realise that the use of this economic weapon is hurting innocent British stockholders, many of whom have very small savings, more than it is hurting the Rhodesian Government?

Mr. MacDermot: What is hurting them is the illegality of the actions of the Rhodesian Government.

Mr. Hastings: Can the hon. and learned Gentleman tell us exactly what these Directors of the Bank of Rhodesia are doing in view of the fact that the Rhodesian balance of payment appears to be satisfactory? Would it not be better to retire them?

Mr. MacDermot: Certainly not.

Public Revenue (Direct Taxation)

Mr. Leadbitter: asked the Chancellor of the Exchequer what estimate he has made of the effect on the public revenue of reducing all direct rates of taxation by 3d. and 6d., respectively.

Mr. MacDermot: The cost for a full year of reducing all the rates of Income Tax by 3d. would be £134 million and by 6d. £267 million.

Mr. Leadbitter: Is my hon. and learned Friend aware of the speech made by the Leader of the Opposition some few days ago indicating a reduction of direct tax rates across the board, the policy statement by the right hon. Gentleman to get rid of S.E.T., and the statement made in the House this afternoon suggesting that we get rid of all forms to collect Income Tax, and does he not consider that the Opposition at the moment are getting themselves into an impossible position, least of all achieving any success in politics?

Mr. MacDermot: Yes. We debated these matters fully in the Finance Bill, when the hollowness of the Opposition's proposals was exposed.

Retirement Pensions (Income Tax)

Mr. Farr: asked the Chancellor of the Exchequer if he will take steps to exempt the forthcoming increases in the retirement age pension from Income Tax.

Mr. MacDermot: No, Sir.

Mr. Farr: Would the hon. and learned Gentleman agree that it is very unfair that these small pension increases, which really replace the purchasing power of pensions eroded by the inflation, should have the little value which can be placed upon them further cut away by Income Tax?

Mr. MacDermot: These pensions are taxable in the same way as pensions generally. The general principle is to levy Income Tax from all sources. This matter has been considered under all Governments, and no reason has been seen for departing from that principle.

Decimal Currency (Machine Conversions)

Mr. Leadbitter: asked the Chancellor of the Exchequer on what criteria the payment of compensation will be made in special circumstances with respect to expenditure or losses incurred arising from machine conversions following the change to decimal currency.

Mr. MacDermot: It will be for the Decimal Currency Board to consider representations about special circumstances. The Government will decide what, if any, compensation to pay in the light of such recommendations as the Board may make.

Mr. Leadbitter: Does my hon. and learned Friend agree that it has been calculated on the basis of the conversion of machines, in particular, that there will be an expenditure in terms of replacement or conversion of something like £80 million? Since the Labour Government will be in office in 1970, could we now have some understanding with the traders involved about some pertinent criteria in which compensation can be paid—[HON. MEMBERS: "Too long."]—because the present conditions—

Mr. Speaker: Order. Even the Hartlepools must be brief.

Mr. Leadbitter: —because the present conditions are causing concern?

Mr. MacDermot: I would remind my hon. Friend that there are no present conditions other than that we do not intend to have a general scheme for compensation. Anyone who considers that he has a special claim for compensation is entitled and is asked to make out his case to the Decimal Currency Board.

Value Added Tax

Mr. Patrick Jenkin: asked the Chancellor of the Exchequer whether he will expedite his consideration of the possible introduction of a value added tax in the United Kingdom.

Mr. MacDermot: I have nothing to add to the statement made by my right hon. Friend the Prime Minister on 8th May.—[Vol. 746, c. 1089–91.]

Mr. Jenkin: While recognising that the Government cannot determine their policy on the basis of a single speech by a member of the European Commission, does not the hon. and learned Gentleman recognise that the point made by Mr. Von der Groeben that the sincerity of our application will be judged by our readiness to harmonise our legislation makes it important that we should press ahead with measures for fiscal harmonisation such as a value added tax with the utmost expedition?

Mr. MacDermot: As my right hon. Friend the Prime Minister made clear, we do not see any barrier in these provisions of the Treaty and will be fully ready to take and play our part in the harmonisation of taxes within the E.E.C.

Mr. Brian Parkyn: Will the Government bear in mind, in relation to this matter, that one of the major reasons for the vertical integration of industry in Holland has been the value added tax, and that it would give us the same kind of benefit in this country?

Mr. MacDermot: I can assure my hon. Friend that we are considering all these relevant matters in connection with this tax.

Maintenance Payments (Remission to Rhodesia)

Mr. Worsley: asked the Chancellor of the Exchequer (1) what is his policy towards the payment by divorced persons resident in this country of money for the maintenance of their children resident in Rhodesia;
(2) why Mr. S. I. Posen has not been allowed to remit in full the £50 alimony ordered to be paid in 1958 after divorce proceedings before a British court sitting in Southern Rhodesia.

Mr. MacDermot: Under present policy, United Kingdom residents are not allowed to remit funds to Rhodesia for the maintenance of persons in that country except in cases of severe hardship. The amounts which Mr. Posen has been allowed to remit have been calculated in accordance with the normal rules applicable to hardship cases and take into account the financial circumstances of his former wife.

Mr. Worsley: Is this not absolutely shameful? Will the hon. and learned Gentleman look at this again? Whatever the issues and rights or wrongs about the Rhodesian crisis, can it be right to punish children for the failure of Her Majesty's Government's policies?

Mr. MacDermot: I cannot accept that this is punishing children—

Mr. Worsley: Of course it is.

Mr. MacDermot: I have looked carefully at this case myself, and we have applied the hardship test to it. The remission of some moneys has been allowed, but we have taken into account the financial circumstances of the former wife.

Income Tax Act, 1952 (Section 408)

Mrs. Thatcher: asked the Chancellor of the Exchequer what decision he has reached with regard to amending Section 408 of the Income Tax Act, 1952, in view of the comments in the Bates case.

Mr. MacDermot: I would refer the hon. Lady to the reply which I gave

on 6th July to the hon. Member for Hertford.—[Vol. 749, c. 293–4.]

Mrs. Thatcher: Is the Financial Secretary aware that an opportunity has already passed to improve this Section in the Finance Bill? Why did he not take advantage of it then?

Mr. MacDermot: As I indicated in my former reply, we do not think that the Section is in need of amending, and the decision that has given rise to these suggestions was made in conformity with the policy underlying the Section.

Oral Answers to Questions — ADEN AND SOUTH ARABIA

Mr. Winnick: asked the Prime Minister what further consultations he is having with heads of Governments and the United Nations Secretary General over the future of Aden and the South Arabian Federation.

The Prime Minister (Mr. Harold Wilson): My noble Friend Lord Caradon is in close touch with the United Nations Secretary General and with the Special Mission which was appointed by the Secretary General. We are also in touch with other Governments from time to time about South Arabia but it is not the practice to reveal the confidential diplomatic exchanges involved.

Mr. Winnick: Is my right hon. Friend aware of the mounting concern at the violence and tragedy in Aden, which has mainly come about because of the policy of the previous Government? Would the Government now be willing to consider drastic basic changes in the make-up of the South Arabian Federation in order to secure a lasting peace in Aden?

The Prime Minister: We are all deeply concerned about the tragedy and the violence of Aden, whatever explanation any hon. Member may put upon it. Our policy about the South Arabian Federation has been fully stated in the House by my right hon. Friend the Foreign Secretary, and he has also described our hopes of getting a more representative Government there as a result of the consultations which are now going on.

Oral Answers to Questions — COMMONWEALTH COUNTRIES (UNPROVOKED AGGRESSION)

Mr. Blaker: asked the Prime Minister what is the policy of Her Majesty's Government, as distinct from their obligations under specific agreements, in regard to coming to the assistance of a Commonwealth country which is the victim of aggression.

The Prime Minister: Her Majesty's Government would take all appropriate action to help any fellow member of the Commonwealth which was the victim of unprovoked aggression.

Mr. Blaker: Will the Prime Minister give an assurance that there has been no change in policy about giving assistance to Commonwealth countries since the Labour Government came to power? On the other hand, is it not apparent that our ability to give assistance will be reduced gravely if the reductions east of Suez in our Forces foreshadowed in today's White Paper are carried out?

The Prime Minister: There has been no change of policy in this matter. Each case has to be considered on its merits, as has always been the case; for example, in a case not long ago when two Commonwealth countries were involved in conflict one with the other. As to the second part of the hon. Gentleman's supplementary question, I am sure that he will wish to study the White Paper before forming conclusions.

Dr. Gray: Has my right hon. Friend considered giving an assurance to India, and has he tried to persuade India to accept such an assurance so that she might be more ready to sign the non-proliferation agreement on nuclear weapons?

The Prime Minister: I do not think that the question of a unilateral undertaking to India in a nuclear sense is one which arises, and I am quite sure that it would not be acceptable to India. I agree that this is part of the discussions which must go on and continue at Geneva for giving assurances to non-nuclear Powers so that they are willing to sign the non-proliferation treaty.

Oral Answers to Questions — MIDDLE EAST

Mr. G. Campbell: asked the Prime Minister whether he will make a statement on the present effects on Great Britain, including the petroleum position, of recent events in the Middle East.

The Prime Minister: I would refer the hon. Member to the Answer I gave on the 13th July to a Question by my right hon. Friend the Member for Derby, South (Mr. Philip Noel-Baker) and to the information already given to the House by my right hon. Friend the Minister of Power.—[Vol. 750, c. 137.]

Mr. Campbell: Can the Prime Minister give an estimate of the effect of the Middle East war on our balance of payments position, since it is better that the House should be informed from official sources than to have to depend upon conjecture in the Press and elsewhere?

The Prime Minister: Yes. I think that the hon. Gentleman is right about that. It is not possible at this stage to say what is the net cost to our balance of payments of the Middle East fighting. Obviously, there will be some effect, but not as great as has been forecast in some quarters.

Mr. Raphael Tuck: Has my right hon. Friend anything to say about the 270 Arab personnel who are at present receiving training in Army, Navy and Air Force establishments in this country? Does he not think, as the war is not over, that it is about time that we stopped training Arabs to kill Israelis?

The Prime Minister: I have nothing to say about that position. If my hon. Friend would care to put down a Question to my right hon. Friend the Secretary of State for Defence, who is responsible for the training of overseas personnel in this country, no doubt he would get a reply.

Mr. Heath: Can the Prime Minister be more explicit about the actual cost per month on the balance of payments, at least with regard to imports? I understand the difficulty about exports, but figures have been given as high as £180 million a year for imports alone. Can he correct this more explicitly?

The Prime Minister: I think that it is too early to make an estimate. Any figure of that kind would be an extraordinary estimate on anything that we know at the present time. It is too early to say even what was the effect on our June import position of the non-arrival of cargoes, for example because of the closure of the Suez Canal, but anything like the rate mentioned by the right hon. Gentleman is far beyond any estimate that I have seen.

Mr. Molloy: asked the Prime Minister what proposals Her Majesty's Government will be advancing to achieve a lasting settlement in the Middle East.

The Prime Minister: I have nothing to add to the Answers to Questions given yesterday by my right hon. Friend the Foreign Secretary.—[Vol. 750, c. 1510.]

Mr. Molloy: Would my right hon. Friend agree that any proposal which might be put forward to achieve a lasting peace in this area must include the fact that the ordinary Arabs should share in the revenues from oil and that this, allied to the interchange of ideas and information between the Israelis and Arabs, could lead both of them together to launch a real attack on the problems of that area, which are ignorance, disease and poverty?

The Prime Minister: I think that that objective would be supported by hon. Members on both sides of the House. A more equitable share of the oil revenues was a point often made by Aneurin Bevan when we debated Middle Eastern issues in this House and certainly Israel has shown that she has a great deal to contribute to world development once the political bars to co-operation between Jew and Arab are removed.

Mr. Tapsell: How does the Prime Minister explain the contrast between Ns rush forward to make his ill-advised statement about the Straits of Tiran and his present passive attitude to the far greater importance of the international right of way through the Suez Canal?

The Prime Minister: I am sorry if the hon. Gentleman did not approve of the statement that I made about the Straits of Tiran, which was fully supported by his Front Bench in the debate that immediately followed, and by Opposition

Front Bench spokesmen. The question of the Suez Canal was dealt with yesterday by my right hon. Friend the Secretary of State for Foreign Affairs. It is necessary to create the political conditions—we have to be realistic about this, including the question of possible military activity on both sides of the Canal—before we are likely to see a rapid movement towards clearing the Canal. As my right hon. Friend said, the agreement to have United Nations observers on the Canal is a useful step towards this.

Mr. Grimond: Can the Prime Minister give us an assurance that Her Majesty's Government's representatives at the United Nations will press that in any lasting settlement in the Middle East the situation in the Yemen will be dealt with, where reports of the use of poison gas are horrifying, and do not seem to receive the attention they deserve?

The Prime Minister: I think that they have received the attention they deserve. As the right hon. Gentleman knows, they have frequently been condemned by my right hon. Friend and other members of the Government, and also at the United Nations where this matter was the subject of some debate recently. This is a deplorable development. Any final settlement for the Middle East must take up the question of the Yemen, but the question of atrocities in warfare is a matter which should be dealt with separately, and should be dealt with by universal condemnation by the whole of mankind.

Mr. Winnick: Is my right hon. Friend aware that there is still a great deal of concern about the position of Arab refugees arising from the last armed clash? Can my right hon. Friend say what kind of international action can be taken and should be taken quickly to alleviate the hardship and misery of so many Arab refugees in the Middle Eastern area?

The Prime Minister: My hon. Friend is right, and indeed from the earliest debates that we have had on the present crisis, even before the fighting began, I think hon. Members on both sides stressed this as a matter of urgency, which has been made much more urgent by the increase in the number of refugees. This was one of the subjects dealt with in a Resolution of the General Assembly


of the United Nations. We are giving what help we can to the refugees on the West Bank, and there is, I think, a sense of urgency among those concerned to try to get this problem dealt with as a humane operation first, and then settled as a political operation afterwards.

Oral Answers to Questions — MARINE SCIENCE AND TECHNOLOGY

Mr. Hugh Fraser: asked the Prime Minister whether he will now set up a body draw from scientists and businessmen and chaired by a person outside Parliament urgently to recommend to him the outlines of a national programme for sea use and marine science and technology.

The Prime Minister: I think we should await the outcome of the reviews referred to by my right hon. Friend the Secretary of State for Education and Science in answer to a Question by my hon. Friend the Member for West Lothian (Mr. Dalyell) on the 3rd of July.—[Vol. 749, c. 195.]

Mr. Fraser: Would the Prime Minister agree that at the moment the gap between technology and science is widening the failure to identify targets, and, what is more, that one has little cause to appreciate what use his Ministers are in this process? They have had two years to sort it out, and the truth is that they have failed.

The Prime Minister: The right hon. Gentleman initiated a useful debate on this subject not long ago and I have nothing to add to what was said then. As the right hon. Gentleman knows, the Natural Environment Research Council, which was set up after we came to office, is examining various research projects which promise to lead to economic benefit. It will be some little time before it can identify its targets in this field.

Mr. Maxwell: Will my right hon. Friend bear in mind that oceanography is a science which we as an island nation should support very strongly as it has tremendous potential not just for purposes of defence, but also for purposes of agriculture, environment, weather control, and all these things to which at present we are not devoting anything like the resources that we should devote—

Mr. Speaker: Order. The hon. Member must be brief, or he will get into deep water.

The Prime Minister: I agree with my hon. Friend about the importance of oceanography and indeed about underwater geology which is now yielding valuable results. It is a question of how much of our resources, financial and otherwise, can be devoted to this compared with competing claims on our science and technology budget.

Oral Answers to Questions — SECRETARY OF STATE FOR ECONOMIC AFFAIRS (SPEECH)

Mr. Ian Lloyd: asked the Prime Minister whether the speech by the First Secretary of State and Secretary of State for Economic Affairs at Birmingham on 25th June on the extension of public ownership represents the policy of Her Majesty's Government.

Mr. John Lee: asked the Prime Minister whether the public speech by the First Secretary of State and Secretary of State for Economic Affairs at Birmingham on 25th June on the further extension of the public sector of the economy represents the policy of Her Majesty's Government.

Mr. Alec Jones: asked the Prime Minister whether the public speech by the First Secretary of State and Secretary of State for Economic Affairs at Birmingham on 25th June on extensions of public ownership represents Government policy.

The Prime Minister: Yes, Sir.

Mr. Lloyd: As all Governments are demonstrably less efficient at controlling the dissipation of resources in the public sector than in inhibiting the creation of wealth in the private sector, can the Prime Minister say why the current annual rates of 9 per cent. and 16 per cent. in current and capital expenditure in the public sector should not be taken to indicate a grave deterioration in national solvency of a far graver kind than that in the balance of payments deficit which the Prime Minister laments with such monotonous regularity?

The Prime Minister: While not wanting to compete with the hon. Gentleman's polysyllabic preamble, still less to agree


with it, I would only say to him that the rate of public investment this year is rising, despite the fact that the bulge in the electricity programme which was necessary about two or three years ago is now easing off because it has reached the capacity necessary to avoid the danger of excessive power cuts in the winter months. With regard to the other items of public investment, these have been showing a sharp upward trend.

Mr. Lee: Bearing in mind that under the Attlee Government after the war there was a succession, without any fuss, of industries being nationalised, and bearing in mind also that the steel industry has now been renationalised, will my right hon. Friend say what will be the next major industries to be the subject of the extension of public ownership?

The Prime Minister: In the 1945–50 Government the public ownership programme was carried out in accordance with the manifesto on which the Labour Party fought the 1945 election. That has been the position in this Session as well. If my hon. Friend wants to study what was in our election mandate, he should read again the election manifesto on which he was elected to the House.

Mr. Alec Jones: Would not my right hon. Friend agree that hon. Members on this side of the House would welcome an extension of public enterprise, and would he not further agree that in the development areas the advance factory programme can be pressed more effectively by a rapid extension of public enterprise?

The Prime Minister: My hon. Friend is well aware of the discussions that we had on this programme before we came to office, and I have nothing to add to the outcome of those discussions. What my right hon. Friend was referring to in his speech was the fact that over a fairly wide feld, including science-based industries, including new projects resulting from technological research, including some of the things which are necessary for re-structuring industries, it may be necessary to ask the House for permissive powers—the aircraft industry has already been mentioned—to enable this to be done. This is what my right hon. Friend had in mind. It may be to the convenience of the House to have one Measure which will enable action of this

kind to be taken, but this does not involve an extension of nationalisation in the sense in which it has previously been considered.

Sir C. Osborne: Would it not be wiser and more sensible to postpone the nationalisation of any further industries until those which have been nationalised have been proved to run efficiently and at a profit?

The Prime Minister: If the hon. Gentleman can give many examples of private industries which have shown the same increases as the nationalised ones, I shall be glad to hear them.

Oral Answers to Questions — LONDON-MOSCOW COMMUNICATION LINK

Mr. Biggs-Davison: asked the Prime Minister when his hot line to Premier Kosygin became operational; and when, and in what circumstances, it has been used.

The Prime Minister: I have as yet nothing to add to the Answers given to Questions by the hon. and gallant Member for Winchester (Rear-Admiral Morgan Giles) by myself on 6th July and by my right hon. Friend the Foreign Secretary on 17th July.—[Vol. 749, c. 286; Vol. 750, c. 162.]

Mr. Biggs-Davison: The Prime Minister had no exchange on the hot line with Mr. Kosygin during the Middle East crisis. Is that correct?

The Prime Minister: If the hon. Member will read my Answer he will see that shortly after this matter was discussed in the House Soviet technicians arrived in this country. We were waiting for them to come. That was the reason for the delay. The matter has now been propertly surveyed, and arrangements are going forward for the installation. The absence of this means of communication did not prevent the frequent exchange of messages, through the Ambassador there, between Mr. Kosygin and myself during the Middle East crisis.

SONIC BANG TESTS

Mr. Arthur Lewis: Mr. Arthur Lewis (by Private Notice) asked the Minister of Technology whether he is aware of the concern felt


by the public at large and the hospital authorities in particular at the disturbance being caused by supersonic bangs and whether he will now stop these bangs or arrange for public notification of the time of such experiments.

The Minister of Technology (Mr. Anthony Wedgwood Benn): I am aware that there is some concern, but I do not think it justifies stopping the exercise. Hon. Members who were in London yesterday will have had an opportunity to make their own judgment. The exercise is planned to end this week. The place and time of the final flight will be announced in advance. All the remaining flights in the series will be designed to hold the bangs to within the same limits of intensity as those that have already been made.

Mr. Lewis: Is my right hon. Friend aware not only how disconcerting but how dangerous these bangs are to surgeons who are about to perform operations? Is it not possible for surgeons working in hospitals in areas where the bangs will be heard at least to be told, if not publicly then privately, that these bangs are about to take place? If hospital authorities could be told that, at least it would be some help.

Mr. Benn: I appreciate what my hon. Friend has in mind. What has happened in these tests is that we have authorised some supersonic flying at an intensity well below that which would be experienced from supersonic airliners, and it was a part of the tests, and remains part of the tests, that no notice should be given. I think that on balance this was the right judgment.

Mr. Lubbock: Can the right hon. Gentleman say how many complaints have been received both by telephone and letters as a result of the bangs caused over London yesterday? Is he aware that hon. Members on both sides of the House are already receiving avalanches of letters on the subject? What steps is he going to take to deal with the question?

Mr. Benn: It is not yet possible for me to give figures as to the number of telephone calls and letters that have come in, but it stands to reason that most people who write on hearing a supersonic

bang will be critical of the noise which they hear.

Mr. Richard: Is it not true that the country was assured that the Concord would not fly at supersonic speed over large areas of population such as London? If that is so, may I ask why these tests are being carried out? What are they to establish? Also, can my right hon. Friend say whether, if yesterday's test was well below the level of intensity we are to expect, how much worse it will be than it was yesterday?

Mr. Benn: I do not recall an assurance being given that there never would be any overflying by supersonic airliners. I ask the House to consider the fact that substantial sums of public money are being expended by this country on an advanced aircraft, the financial success of which will in part depend on whether it flies over other people's territory. It is no good our saying that we want other people to buy it and to have it fly over their countries when we are not even prepared to see whether some mild supersonic flights over the United Kingdom are tolerable.

Mr. R. Carr: Can the right hon. Gentleman say more definitely whether, if there were supersonic scheduled flights, they would be overflying London? Secondly, would it not be more purposeful to have these tests in areas below the traffic lines of such services?

Mr. Benn: It is possible that flights between the United States and the Continent of Europe might go over the United Kingdom, although it stands to reason that a supersonic airliner taking off from London Airport would not have reached supersonic speed until it was some way from London. These are the considerations that led us to have the tests, because whether or not we were to build a supersonic airliner, this country would have to decide at some stage whether it was prepared to have supersonic overflying. It would have been helpful if these preliminary tests had been undertaken some years ago, when the Lightnings were available, and we would have had an opportunity of considering this question at an early stage.

Mr. Shinwell: Why all this secrecy about when and where the bangs will take place? Why not advise us in advance


so that we are all prepared for them and can he done with it?

Mr. Benn: One of the reasons for the tests is to see whether—as has happened—people complain about tests that do not take place and people who have not actually heard the bang have an opportunity not to know that the test was taking place. I understand that in the House itself yesterday when the flight took place a number of Members sitting in this Chamber did not hear it.

Mr. Robert Cooke: Will the right hon. Gentleman bear in mind that in Bristol last week, when he was not present in the city, a sonic bang had a shattering effect on the annual meeting of the British Medical Association? If that was a mild bang, when can we expect a genuine Concord bang over that city?

Mr. Benn: I appreciate the hon. Member's filial interest in the British Medical Association. Any comments from doctors and others about the effects of these tests will be very helpful. I thought it not inappropriate that Bristol, a great number of whose citizens are earning their living by building the Concord, should have some supersonic flying over them.

Mr. Michael Foot: Will my right hon. Friend publish the details of what examination of the dangers and inconveniences of these hideous afflictions was made by the previous Government before they entered into any open-ended commitment about Concord? In view of the growing number of protests which are arising throughout the country, will my right hon. Friend undertake to have a proper independent investigation such as should have been carried out a long time ago, on his own admission?

Mr. Benn: I agree that it would have been advisable to have held at any rate these preliminary supersonic fights before a decision was reached, but in fairness to the party opposite, until Concord flies we shall not have an opportunity of knowing what sort of sound it makes itself. It will be an additional consideration to these tests and to any subsequent tests that it is necessary to hold before a decision is reached by the Government whether or not there should be supersonic flying over this country. As to my hon. Friend's general comment about the

noise of aircraft, every new invention has led to a substantial number of protests, and in many cases fears have in part been based upon ignorance, which I was anxious to dispel.

Sir A. V. Harvey: As Concord is a joint effort with the French, are the French carrying out similar exercises, and are we co-ordinating our tests with the French tests? Why cannot the right hon. Gentleman warn the public when these tests are to take place? If he goes on like this he will find himself out of a job.

Mr. Benn: Some of the protests that we have had about sonic flying were attributable to the salvo greeting Sir Francis Chichester on his return to London. One reason why we did not announce the test was that we wanted to have an opportunity of assessing how accurately the public could determine one sound from another. The French have about 400 or 500 flights a year over France. One of the objectives of this series of flights is to bring us a little more experience, with a view to co-ordinating more closely our tests with those of the French and the Americans.

Mr. Edelman: Would my right hon. Frind set the public's mind at rest by saying whether it has been established that these supersonic bangs can cause abortions in animals? [Laughter.] This is no laughing matter. Have there been any investigations into the possibility of the bangs causing miscarriages in human beings?

Mr. Benn: I will answer a further question on the specific point if my hon. Friend will put it down, but I think that he is confusing two current Parliamentary controversies.

Mr. Rippon: Is the right hon. Gentleman aware that the previous Government did carry out tests of this kind in North Wales, at Aberporth, and over Boscombe Down, but that we gave notice of them and made inquiries into the effect on abortion, and that only Welsh farmers suggested that their cows aborted as a result of the noise?

Mr. Benn: I know, of course, that there was some supersonic flying, but it was not designed to give an indication of


whether supersonic flying over populated areas would be tolerable. We have made available to a wider range of people an opportunity to decide whether this is an intolerable interference with privacy.

Mr. Elystan Morgan: Is there any real comparison between the sonic bang emitted from a Lightning aircraft and that which will be emitted from Concord? If not, what is the purpose of the tests? Are they not at best, a waste of public money and, at worst, highly misrepresentative of the real position?

Mr. Benn: As I explained, until Concord flies we shall not know the exact character of its noise when flying supersonically, but there is a strong case for starting with a moderate bang and seeing whether this is tolerable before proceeding further. I think that the House would have strongly objected if we had waited until the Concord was flying before trying it out over a populated area.

Sir Ian Orr-Ewing: Would the right hon. Gentleman bear in mind my right hon. Friend's suggestion that these tests might be conducted in the air corridors where these supersonic aircraft are most likely to fly, and also that the great majority of the population feel that the roar of subsonic aircraft day and night in areas near airports is much more objectionable than occasional sonic bangs?

Mr. Benn: I agree with the hon. Gentleman's second point, that the very high and prolonged intensity of an aircraft taking off and landing is much more irritating and more likely to affect hospitals and others than a single impact of a supersonic plane. His other point seems to be that we should test them, but not here. I am not sure that there is not a case for testing them over large centres of population, as we have a strong national interest

in persuading other countries that they ought to buy Concords and use them over their own territories, because it is from this that the larger market for Concord will come.

Mr. Richard: In view of the Minister's answers, I beg to give notice that I will raise the matter on the Adjournment as soon as possible.

COMPLAINT OF PRIVILEGE (MR. SPEAKER'S RULING)

3.45 p.m.

Mr. Speaker: I have a Ruling to make on Privilege. Yesterday the hon. Member for Rutland and Stamford (Mr. Kenneth Lewis) drew attention to a report in the Evening News on Thursday, 13th July, which appeared to him to constitute a breach of privilege. I have given very careful consideration to the hon. Member's complaint, and I have also studied the precedents to which he referred in support of his submission. It is my duty, however, to inform the House that, in my view, the report in the Evening News does not, prima facie, constitute a contempt of this House and does not, prima facie, involve a breach of any of its privileges.
This simply means that I cannot allow the hon. Member's complaint precedence over the Orders of the Day, but that has no effect on what the House may choose to do in the matter if it should be raised by the hon. Member or anyone else by a substantive Motion.

BUSINESS OF THE HOUSE (SUPPLY)

Ordered, That this day Business other than the Business of Supply may be taken before Ten o'clock.—[Mr. John Silkin.]

Orders of the Day — SUPPLY

[27TH ALLOTTED DAY] [2nd Series],—considered.

BUS OPERATORS, ROAD HAULIERS AND PORTS AND DOCKS INDUSTRIES (NATIONALISATION)

3.46 p.m.

Mr. Peter Walker: I beg to move,
That this House is opposed to further nationalisation of bus operators, road hauliers and the ports and docks industries, and therefore deplores the Government policies which threaten these industries.
Today's debate is prompted by announcements from the Ministry of Transport concerning its intention to introduce a major transport Bill next Session. In bringing forward this matter, it is our objective to see that the country can debate the lines of policy which the right hon. Lady wishes to pursue. In a recent television broadcast, she rightly proclaimed:
I have been a Left-wing Socialist all my life.
I would certainly pay her the tribute of saying that she is adhering to her traditional policies as a Minister.
One might reflect on the former leaders of the Left-wing group of the Labour Party who now occupy Cabinet posts—the Minister of Housing, who has seemingly given up party politics altogether, the Leader of the House, who is incapable of doing so, although he should, and the Prime Minister, whom no hon. Gentleman below the Gangway would accuse of adhering too dogmatically to his former Left-wing Socialist policies. But no one can object that the Minister of Transport is changing her former Left-wing policies. As the hon. Member for Ebbw Vale (Mr. Michael Foot) wrote recently in Tribune:
At least in the Ministry of Transport there is a Socialist at work in Whitehall.

Hon. Members: Hear, hear.

Mr. Walker: I well understand the confirmation of this by hon. Gentlemen opposite, but the public's view is not that the right hon. Lady is pursuing particularly

Left-wing policies, because all the publicity on transport since she has been Minister has concerned freightliner trains, road building and constant publicity as she opens various roads which my right hon. Friend the Member for Wallasey (Mr. Marples) started. All the documents and White Papers like that on road safety give the impression of a Minister concerned with practical details of transport policy and not pursuing particularly Left-wing policies.
I congratulate the right hon. Lady on her skill in giving this impression, because the performance on road and rail shows that while she has been Minister the Government have, for the first time in post-war Britain, had to cut the road building programme which they inherited from the Conservatives and which was described by the former Shadow Minister of Transport, the right hon. Member for Vauxhall (Mr. Strauss), as
… too late, too little and totally inadequate.
That programme has since suffered from £55 million-worth of deferments and £14 million-worth of cuts. On the railways, there has been a steadily increasing deficit.
The way in which these cuts have been concealed by the announcement of many hundreds of millions of £s of roads going into the preparation pool, and such techniques as that, has been a very skilful political operation. But on this side of the House we should much prefer that the right hon. Lady should concentrate on the practical problems of transport and of seeing that the preparation pool roads become real roads in the future and that the deficit of British Railways is reduced by good management and by stopping the over-manning which is taking place at present. We feel that instead of next year's nationalisation measure she should introduce a major road safety Bill. In fact, we are told that next year we are to have this mammoth Transport Bill, described in the New Statesman recently by Mr. Paul Johnson in this way:
Mrs. Castle is said to have an immense transport Bill based on true Socialist principles".
It is the extent of those true Socialist principles that we wish to expose to the general public this afternoon.
These principles fall into three major categories, and in total they present a


mammoth programme of nationalisation, far greater than the nationalisation of the steel industry. The total compensation which will be involved in the public ownership of the bus companies, in the acquisition of road haulage fleets by the national freight authority and in the complete nationalisation of the ports and docks will certainly dwarf the amounts involved in the nationalisation of steel.
The three main lines of the right hon. Lady's nationalisation proposals are, first, the passenger transport authorities which will take over the bus companies; secondly, the national freight authority, which will take over road haulage companies; and thirdly, the complete nationalisation of the ports and docks.
I want to deal, first, with the Minister's startling proposals concerning the passenger transport authorities. The first indication of these were published in a White Paper last year. It is 12 months since the initial proposals were made. There was no indication in that White Paper that these passenger transport authorities would result in a massive acquisition of bus companies and other services. Indeed, on 1st December last year, the Minister published a memorandum which she had sent to local authorities as a basis of discussion, and we were all able to see those proposals. Once again, they contained no definite proposals to acquire the operating bus companies.
In January, the right hon. Lady made a tour of the conurbations and spoke to the operators and the local authorities involved. I would point out to the right hon. Lady that the local authorities with whom she spoke on that occasion have somewhat changed their political complexion since then. In May, there were massive changes in the political complexion of these authorities. For example, Manchester, Liverpool and Newcastle all now have Conservative majorities, and Birmingham has substantially increased the Conservative majority on the local authority. To get up to date with the current view of those conurbations, expressed by their democratically elected representatives, perhaps another tour is called for.
But these proposals have been replaced by a document sent to local authorities—

the first document to be marked "Confidential". Fortunately, it is no longer confidential, because it has been published in the magazine Motor Transport almost in its entirety, and the Birmingham Post, too, has published great sections of the document. Having seen the document, and noting the Minister's current proposals, we immediately required this debate, because the proposals which she is currently making cannot be said to be a basis of discussion, because these proposals are after 12 months of work by the right hon. Lady, within 14 weeks of the Bill being published, and after she has spoken to conurbations and to operating companies. We can therefore take it that these proposals are very near to the final proposals that the Minister will make. They add up to a massive nationalisation programme.
We can understand the reluctance to make this document known to the public, because the ratepayers and the passengers travelling on bus services in these conurbations will be very alarmed when they know of the Minister's proposals. It certainly appeared that the Minister's intention was to publish a White Paper a week or so before the Second Reading of the Bill and to leave very little time for the public to recognise what was taking place. I therefore want to deal in some depth with the proposals now made to the local authorities by the Minister.
First, I will consider the reasons for creating the passenger transport authorities. Three main reasons are given in the memorandum. The first is the advantage of size and the advantage of reducing fares by a larger scale of operation. I would point out that there is no evidence to support that. Indeed, there is very strong evidence against it—and not evidence simply from one of the private operating companies, but evidence, for example, from the head of economic research of the Transport Holding Company, who in a recent Paper stated:
There is no evidence that the customer is the more satisfied with the bus services provided, the larger the size of the undertaking. If efficiency is to be measured by cost, there is equally no evidence that larger size reduces costs".
This is the evidence of the head of economic research of the nationalised bus operating companies.
The second advantage claimed was that of co-ordination. This is a very poor reason for going in for the nationalisation programme which the right hon. Lady later outlines. The Minister set up nine regional co-ordinating committees on passenger transport. We could easily have awaited the reports of those Committees. I have a feeling that the Minister knows that the reports of those committees would expose her argument, for already there has been an inquiry between British Railways, the London Transport Board and three of the larger operating companies which looked into these problems of the co-ordination of time-tables and schedules, and it showed that there was not a great deal of need for improvement—and, after that report, all the necessary improvements were made.
The third reason given was the vague reason of long-term planning. The Government and, least of all, the Ministry of Transport have little to boast about in their achievements in long-term planning. It is a little over 15 months ago that the National Plan was published, but almost every line of the section on transport in that National Plan has already proved .12, be absolutely false and wrong. That gives little confidence in the advantages of long-term planning.
Let me come to the proposals. First of all, the passenger transport authorities are to be set up. They are to be set up by a designation Order made by the Minister under the powers given to her by next year's Transport Bill. The area is to be designated by the Minister—and it is to be designated by her with no right at all of the local authorities to protest against the area which she designates or the powers which the Minister gives in the designation Order. Indeed, the memorandum sent by the Minister to the local authorities categorically stated that there would be no procedure for formal objection or public inquiry.
We know full well the reason why the Minister refuses to give the local authorities concerned any right of formal objection or any right of a public inquiry. It is that when an attempt was made by the previous Labour Government in 1947 to nationalise the bus industry, the majority of local authorities owning bus services, including many Socialist-controlled local authorities, took advan-

tage of the procedure given to them to object to the Minister's plans and to have a public inquiry. This Minister's proposals, as at present framed, will give no scope at all for the democratically elected leaders in the localities to have a procedure for objection or for public inquiry.
The next stage, after the designation Order is made, is that all municipal assets will be passed over to the passenger transport authority. This is much against the wishes of the local authorities. Birmingham, for example, with £10 million worth of assets built up over the years in its municipal bus company, will have to hand those over, without compensation, to the passenger transport authority. If the Minister consults the local authorities on this question, she will find them almost unanimous in their wish not to hand over the municipally-owned bus companies. Only yesterday, the five West Midlands county boroughs in their joint committee, Dudley—appropriately enough—Warley, Wolverhampton, Walsall and West Bromwich, issued a statement, after a meeting held in Walsall, saying that they had no intention of seeing their bus services handed over to the type of P.T.A. described by the Minister.
The third stage is that the P.T.A. will lay down which privately-owned bus companies it wishes to purchase. These will then be purchased, if necessary under compulsory purchase order issued by the Minister. Not only will the P.T.A. be allowed to nationalise the whole of the bus companies, but it will be allowed to take from the free enterprise operators specific routes. It can take the best routes and leave the free enterprise companies with the worst paying routes. Some form of compensation will be paid, but one queries the basis of it.
There is thus to be immense power in the passenger transport authorities to acquire both municipally-owned assets and private assets. The House may well wonder what is to be the composition of the P.T.A.s. The Minister's proposals here are alarming. Two-thirds of the representatives on a P.T.A. will come from the counties and county boroughs in the area designated, but, significantly, it is added that the Minister will be able to refuse the nomination of an unsuitable


person and request the council to nominate an alternative and to act in default if the council does not do so.
Thus, it will be two-thirds in the hands of the local authorities, but the Minister will have power to veto any nomination. The other third are to be nominated direct by the Minister. This means that, in a conurbation area designated by the Minister where the local authorities are 70 per cent. Conservative-controlled and 30 per cent. Labour-controlled, the majority on the P.T.A. can be chosen by either Socialist councils or a Socialist Minister. This is what the Minister calls bringing democracy into public transport. Further, the Minister will appoint the chairman of the P.T.A., and she will have to be consulted on the appointment of the chief executive of the P.T.A.
The enormous powers to be given to the P.T.A.s are, perhaps, the most startling feature of all in the document. It is proposed that the Bill should confer wide powers on passenger transport authorities, powers to carry on all forms of passenger transport except air transport—there is a concession—and, in particular, P.T.A.s will be able to run: (1) stage and express bus services; (2) tours and excursions; (3) contract bus services wholly or partly within the P.T.A. area; (4) hovercraft and ferries; (5) any new forms of transport, such as monorail; (6) any stretches of railway that British Rail does not wish to run; (7) taxis; (8) hire cars.
In addition to all that which can be run by the passenger transport authorities, the memorandum goes on to tell us that the P.T.A. will be empowered to undertake ancillary activities such as vehicle repair, the provision of refreshments, and the operation of bookstalls. In total, this is a mammoth extension of public ownership by what will be largely a Ministerially-controlled body.
The Minister has said that it is not her intention to set up regional nationalised bus companies. She wanted, she said, to have a strong local influence. She says that this is not nationalisation. But let us look at the similarities between her proposals and nationalisation. As with nationalisation, the chairman will be appointed by the Minister. As with nationalisation, the members of the

authority will have to be approved by the Minister, and a third directly appointed by her. As with nationalisation, she will be consulted on the chief appointments. She will have complete power to designate the areas concerned, without any form of public inquiry.
The only difference between the Minister's proposal and outright nationalisation is that, whereas the losses are met by the Government under nationalisation, under these proposals the losses are to be met by the ratepayers of the conurbations concerned. Undoubtedly, higher fares and higher rates will result from the Minister's proposals.
The next part of the memorandum tells us of the powers which the passenger transport authority will have regarding the railways. This will be of interest to members of the National Union of Railwaymen, particularly to those hon. Members who recently took part in our debate on the railway deficit when, it will be remembered, I queried the 11,000 miles proposed.
The Minister says that a P.T.A. will be able to contract with British Rail for all the services it wishes to have in the locality, and the contract will be negotiated on the basis of paying British Rail a full economic price for the services provided. One can envisage the difficulties of such negotiation, with no alternative rail company to offer a quotation. How will one check on the apportionment of head office overheads and regional overheads which will be put to the local services? How much of the railway deficit will be shifted on to the ratepayers by this proposal?
Apart from that, we are told that the P.T.A. will be under no obligation to maintain any particular suburban rail service. If it does not consider it desirable to maintain the service, the P.T.A. would so indicate to British Rail, which would then propose closure. This is the proposal which comes from a Minister who published a map showing 11,000 miles of railway which would not he touched. In those 11,000 miles are included some of the railways which, the Minister now says, the P.T.A.s will have power to close should they think it desirable.
The ratepayers will have put on them eventually the existing railway deficit,


which the Minister estimates at something over £10 million. She says in the memorandum that it will be right ultimately for the P.T.A. to assume full financial responsibility for its contract with British Rail, and she advocates an interim period when some Government grants would be made to stop the immediate agitation which would otherwise come from all the ratepayers involved.
The one bait in the memorandum to the people concerned is the proposal for infrastructure grants. The Minister says, "If you give up all your bus services, if you agree to this great bureaucratic plan, if you agree to my nominating a third of the membership of the P.T.A., to my nominating its chairman, and to my being consulted about the chief appointments, the advantage will be some infrastructure grants for you for major improvements in public transport".
How much? How much can we expect at present? This is a proposal by a Minister who has already cut the road building programme by £14 million, who cut the railway investment programme by £10 million last year, and who cut the clocks programme by £10 million last year. Where is the money to come from for these infrastructure grants?—from tolls on motorways, or by doing away with the Channel Tunnel project? Already, there are 12 hon. Members opposite calling for emergency meetings of the Parliamentary Labour Party to discuss all the cuts which are to take place in public expenditure. Yet the bait that the Minister puts to the local authorities is, "Hold on, because we may well be giving you some infrastructure grants". In the present economic climate—the economic stagnation of this country under this Government—local authorities have very little chance of any substantial infrastructure grants.
If the Minister really wanted to help public transport and to decrease its costs, there are many things she could do other than this nationalisation proposal. She could bring investment allowances back for buses and coaches. She could do something to ease or to remove the S.E.T. burden on bus companies. She could do something about the fuel tax in relation to buses. She could make some grants to provide better parking facilities at stations. This sort of nationalisation proposal is not needed.
These proposals will result in an enormous burden on ratepayers, will take out of local authority hands areas of control which they at present enjoy, and will result in enormous compensation having to be paid by the taxpayer to these bus companies, with no improvement in service. On the contrary, a very considerable deterioration in service will take place.
I am anxious that everybody in the conurbations concerned should recognise the dangers involved. If the Minister's proposals in the Bill are anything like the proposals in this memorandum, I hope that time will be given for the conurbations to realise what is involved. I should be delighted to debate in any of the conurbations involved the proposals the Minister makes as far as they affect ratepayers and taxpayers.
That is the first proposal. As if that is not enough, there is the proposal for the National Freight Organisation and its threat to the road haulage industry. Who wants the National Freight Organisation? British Railways? Certainly not. Everybody who has any contact with British Railways will know that all of its management are strongly opposed to the concept of the National Freight Organisation. The Transport Holding Company? Of course it does not. The Transport Holding Company, which has been one of the rare commercially-run nationalised concerns, is violently opposed to its company being broken up in this way. The private haulier? Obviously he does not, because he realises that he will be met with unfair competition. The public? Certainly not. There is no clamour from the public for the National Freight Organisation. The unions? Certainly not.

Mr. Charles Mapp: The hon. Gentleman has just implied that the private haulier will face unfair competition from the National Freight Organisation. Will he prove his point?

Mr. Walker: If the hon. Gentleman will wait for a few seconds, he will find I am coming to the point where I illustrate the fear I have on this topic.

Mr. Mapp: "Fear"?

Mr. Walker: I will explain why I think that my fear is well founded. I am sure


that the hon. Gentleman will be prepared to wait a few seconds. Last Friday's Railway Review, the journal of the National Union of Railwaymen, reporting on its conference at Aberdeen, refers to some of the comments made at the conference about the N.F.O. I defy anybody here to find one comment of a friendly nature which was made at that conference about the N.F.O. Every speech about the N.F.O., as reported in the Railway Review, expressed hostility to, or fear of, this conception.
What does the N.F.O. do? It combines together the lorries of British Road Services with the lorries of British Rail and the freightliner trains. This is the conception. The question might be asked, "What is the objection to this?" There is no particular objection in the sense that, if it is desired to secure a better coordination between British Road Services and British Railways, by all means this should go ahead.
But why confine this operation merely to the 5 per cent. of lorries in this country owned by the Transport Holding Company? If the Minister really wants to get a sensible co-ordination between the road haulage industry and British Railways, and to use its excellent freightliner train facilities, why does not she pursue a policy of trying to encourage the maximum cooperation between the private haulier and British Railways, on the same basis as the co-ordination between British Road Services and British Railways? Why have merely this confined operation?
What would the Minister say if the Transport Development Group, a major free enterprise body, were to ask to set up an identical arrangement, using its lorries in conjunction with freight liner trains, on exactly the same arrangement with British Railways as is to be given to the N.F.O.? What would her reaction be if a dozen or so free enterprise firms in Glasgow, Birmingham or Liverpool got together and said, "We would like a contract with British Railways for freightliner trains", on the same basis as the N.F.O. will have it?

Mr. Mapp: The hon. Gentleman is talking about fears. He has not produced any evidence. Indeed, the evidence to the contrary is here with us. The Ford Motor Company and other companies are

already doing precisely that on terms of equity.

Mr. Walker: I agree with that. I am grateful to the hon. Gentleman for supporting my case. For example, the Minister in her speech to the Road Haulage Association said this:
Many of you are going to be in competition with the National Freight Organisation. I give you fair warning the N.F.O. will not be easy to beat. It will provide a door-to-door service second to none. It will be combining the liner train operations of British Rail—for speed and reliability—with road transport for the distributive haul.
The Minister knows full well that there is no need to form a national freight authority to do this. If the combined rate of going from Glasgow to London by a combination of British road Services and British Railways is exactly the same as the combined rate of an efficient free enterprise haulier and British Railways, this will illustrate fair competition. If it is to be on that basis, what is the point of the N.F.O.? If it is not on this basis—only time will tell—what I suspect is that there will be one company and that, if somebody outside Glasgow asks for a quotation from the N.F.O. to go by freight liner train to London, that quotation will turn out to be very different from what would happen if a private haulier said to British Railways, "I want to send my goods for some part of the journey by freight liner train and I will add my competitive costs of the road journey".
If they are different, if there is an under-cutting process, as all of the Minister's remarks tend to suggest, there will be a situation in which the private road haulier will be unfairly under-cut by the N.F.O. The N.F.O. will be given powers by the Minister, who has clearly stated that she will encourage the organisation to use these powers to the full, to acquire private haulage fleets. First we shall see under-cutting of private haulage fleets. When they are under-cut and making losses, there will be acquisition on the basis of loss-making companies. This is the most dishonourable form of nationalisation. Because of this, if the legislation is on that basis, we shall strongly oppose it.
The third nationalisation proposal of the Minister is the nationalisation of the ports and docks. This is a straightforward nationalisation proposal. Let us examine it and see what it achieves. Of


our 15 major ports and docks, six are already controlled by public boards. There are boards like the Mersey Docks and Harbour Board and the P.L.A., which are already public, non-profit-making boards. Seven are already nationalised, and are under the aegis of the British Transport Docks Board. One is Bristol, a local authority-owned port. One is Manchester.
What is the point of nationalising a port like Bristol and taking it out of municipal control? Indeed, it was surprising that the Minister herself, speaking at Avonmouth—I say "surprising", because nobody has done more to slow progress at the Port of Bristol than the present Minister—proclaimed her advocacy of nationalisation and said that the reason for nationalisation was that we were following behind the Continent and that ports like Rotterdam were going ahead.
Has not anybody told the Minister that Rotterdam is a municipally-owned port and that the great rival she has often mentioned is not a nationalised port at all but is owned by the municipality? Therefore, if she is impressed by Rotterdam, that is all the more reason for allowing Bristol to remain in local authority control.
Why nationalise the P.L.A. or the Mersey Docks and Harbour Board? Are they doing anything particularly irresponsible at present? Why nationalise the Port of Manchester, whose chief shareholder is the city of Manchester? Whether Manchester has been under Labour or under Conservative control, that Board, which has a majority of local representatives on it, has worked well and is an object of great pride to the city, no matter what political complexion the Council may have at any particular time.

Mr. Kevin McNamara: The hon. Gentleman refers to Manchester as a port, citing it is an example. As Manchester has complete, unified control over the stevedores, the forwarding agencies and the like, is he advocating that we should apply this to all ports?

Mr. Walker: I think that there are certain operational advantages at Manchester, but this is no reason for nation-

alising Manchester. The hon. Gentleman seemed to be saying that because Manchester has a pattern of organisation which he admires the Government should nationalise it.

Mr. McNamara: Would not the hon. Gentleman agree that if all the ports had this pattern of organisation it would be a good thing? But it does not exist in other ports.

Mr. Walker: It does not exist in some of the nationalised ports. This does not enter into the nationalisation argument. The hon. Gentleman is saying that if a free enterprise port is operating on a line that he admires and the nationalised ones are not, the free enterprise ones should be nationalised. Why nationalise a port like Felixstowe, which has been a great innovator in the port industry, initiating methods which have livened up some of the other ports? Why nationalise a port like Shoreham, which has reduced its fees and charges through its efficiency? Why nationalise all the small ports which stimulate competition in the short sea trades and maintains flexibility and elasticity of connections with Continental Europe?
Let us look at the disadvantages of nationalisation. Enormous compensation would be involved—between £900 million and £1,200 million—in the assets of the major port and dock companies according to the evidence given by the National Ports Council. Probably there would be disadvantages in terms of labour relations. There would be great danger that what would otherwise be disputes confined to certain ports and companies would be spread out on a national basis. It would mean the destruction of the small innovators in the industry. It would create another London-dominated, London-controlled bureaucracy.
In a recent Press handout on the subject issued by the Ministry of Transport, the Minister tried to suggest that the local regions would have considerable powers. There was a stunning paragraph which said that, while the National Port Authority would control policy on finance, planning, investment, revenue, targets, pricing, research, training and key appointments, the regional port authorities would have a wide measure of autonomy. So provided that they had nothing


to do with finance, planning, revenue targets, pricing, research, training and key appointments, they would have complete freedom to operate as they wanted. This is the sort of enormous bureaucracy which would be created.
The problem of port and docks will not come up in the next Parliamentary Session. It will not come up for further consideration in the one after that. But if we return to power at a time when nationalisation has not been completed we shall have nothing to do with it, and if we come to power when it has just been completed we shall do all we can to reintroduce a system whereby there is a much greater interest and stake for those involved in its operation than under any nationalised concept.
These proposals add up to the most enormous attempt by, as the Minister describes herself, a Left-wing Socialist Minister to bring wholesale public ownership into our transport system. If ever there was an area of our economy in which to encourage enterprise and the enterprising it is transport, and if ever there was an area of our economy in which we wanted to see the best scope for competition, it is the transport industry.
The terrifying thing about the whole programme is that, instead of the Minister concentrating on the practical task facing the country in terms of transport, we shall be involved in the next two years in this gigantic Socialist programme towards transport, and I believe that there will be no improvement at all in the efficiency of the transport industry.
The Government have been disappointed with regard to the fulfilment of the hopes that they put before the public in the 1964 General Election. They must also be disappointed about the stagnation in our economy. They must realise that they will never get away from that stagnation so long as they act in a constantly hostile fashion towards the whole free enterprise sector. We have a mixed economy. At the moment the private enterprise industrialist has to depend on a nationalised industry for his coal supplies, gas supplies, electricity, rail transport and, more recently, his steel. He will in future have to depend more and more upon nationalised road haulage, nationalised ports and docks and

the nationalised movement of passengers by bus. There comes a stage in this mixed economy where so much of his basic costings are dependent on the costings laid down by the State and nationalised industries that he does not have the freedom to operate competitively. If the Government want to get away from their stagnation, the way to do it is to encourage the free enterprise sector, not to attack it in the hostile way that the Minister is going to attack it in all spheres of transport over the next two years. It is for this reason that we shall divide the House tonight.

4.26 p.m.

The Minister of Transport (Mrs. Barbara Castle): I am grateful to the hon. Member for Worcester (Mr. Peter Walker) for his opening remarks with their complimentary reference to my consistency. I return the compliment. He, too, is consistent. He is consistent in inaccuracy. It does not matter how often one refutes and pins down some of his dashing, wild statements from the Dispatch Box and elsewhere. Undeterred he pops up again a few weeks later to repeat them word for word.
We have had an example trotted out again this afternoon. We have the supposed example of what has happened with regard to roads expenditure. The hon. Gentleman says that a Left-wing Socialist Minister, distracted by her nationalisation plans, has allowed to take place a cut in the road programme of the Conservative Government. The trouble was that the Conservative Government never had a roads programme at all until 1960. Contrary to what the hon. Gentleman said, our road programme has increased steadily and persistently year by year. This year it will be 30 per cent. higher than it was last year. We have succeeded with our practical policies in doubling in the last five years this country's long overdue expenditure on road development. Under a Labour Government we are now enjoying the largest road-building programme in our history. This is a fact, and nothing that the hon. Gentleman repeats can get away from it.
The accusation that the hon. Gentleman has made against me is that, instead of concerning myself with practical details of transport policy, I am busy with sinister Socialist plots. But what the


hon. Gentleman does not realise is that all the objective facts now clearly show that in transport the only practical policies are Socialist ones. By the time I have finished my remarks I shall have established that irrefutably. Nothing shows more clearly than the Motion and the speech that we have just heard that the Opposition are bogged down in out-of-date transport concepts and stale ideologies. As for the practical side, the only policy that we have had from the hon. Gentleman today has been one of no change.
The fact is—and surely every hon. Member should be aware of it—that in the past five or six years a transport revolution has been creeping up on all of us. Yet all the Conservative Party can do is to hug its antediluvian prejudices as though the traffic explosion had not forced us all to rethink fundamentally the transport needs of our towns; or as though the container revolution was not challenging us all to see the flow of freight as one worldwide integrated movement of ship, road and rail for which we must plan and reorganise nationally with a desperate sense of urgency.
One of the ironies of the Motion is that it deplores the Government's nationalisation proposals, which, the hon. Gentleman says, "threaten" road haulage, bus operators and the ports and docks industries. But one of the landmarks in transport thinking today—I am sorry that there was no indication that the hon. Gentleman had taken time even to glance at it—is contained in the second McKinsey Report, "Containerisation: the key to low-cost transport". The hon. Gentleman made a great deal of the importance of low cost transport to our economy and I agree with him. That is why I believe that the Report is essential reading for anyone trying to get a solution to our transport problems.
I remind the hon. Gentleman that this outstanding Report was commissioned by a nationalised industry, the British Transport Docks Board. When he talks of nationalisation threatening our docks and ports, I remind him also that, commercially and financially, the Board, which controls 29 ports, has proved itself to be one of the most successful bodies in the whole of industry.
What is more, it has established itself in the forefront of technological progress. Since its inception in 1963, it has always made a profit and the net surplus is around £1 million to £1½ million each year after realistic depreciation and interest have been taken into account. The Board maintained this even in 1966, when there were exceptional trading difficulties and many commercial concerns showed lower profits.
The Board has proved itself managerially streamlined and in policy infinitely flexible. Faced with the loss of some traditional traffics, such as coal exports from South Wales, it has not sat back but has gone out to attract new traffic to take its place. During the four years of its existence, it has spent over £24½ million on capital investment, £20 million of this supplied from its own resources. That is an outstanding achievement by any reckoning.
What is more, it is the Board which has pioneered the adaptation of our ports to containerisation. Grangemouth, one of its ports, was the first British port to have a deep-sea container service to the United States, and special facilities for deep-sea container services are being constructed at Southampton and a new berth at Newport may be equipped for containers as well. What is more, the Board has pioneered modern techniques in management, training, research and operation and its training college at King's Lynn has set an example in the application of modern training techniques to the whole ports industry. I do not call this "threatening" the industry but saving it.

Mr. Robert Cooke: Will not the right hon. Lady now concede that the Port of Bristol would be doing as well if she would only allow it?

Mrs. Castle: I am sorry. I am not here to knock Bristol or any other port. But the simple fact is that the Board has given us a prototype of the sort of organisation and dynamism which nationalisation will enable us to introduce throughout all our ports. This is why I have asked Sir Arthur Kirby, the Chairman of the Board, to chair the National Ports Council in preparation for this transition to public ownership.
I seriously recommend the House to read the McKinsey Report, because it has significant lessons for us throughout the whole of transport. It may be that the pace and scale of containerisation will not prove to be as great as the Report suggests. Nevertheless, taking all that into account, there are urgent implications for our whole transport policy. I do not suppose that anyone will question the fact that containerisation can bring dramatic economies in our transportation costs. McKinsey suggests that they may be greater than 50 per cent. in many cases.
But these economies are not limited to our ships and ports. We all know that in the ports one container berth equals the capacity of 20 break-bulk berths. But these economies, properly mobilised and properly backed by a good administrative structure to make them possible, can flow throughout the whole inland transport system.
Containerisation has also radically altered the relative economics of road and rail. One theme is hammered home in the Report over and over again. It is that the development in transport of a standard unit—the container—calls for an integrated system of cargo movement covering the entire transportation process between point of origin and final destination. The Report sums up its conclusions as follows:
Thus, road and rail transport, ports, ships etc. may be viewed as the component links that collectively represent a total transportation system.
It is urgent, if we want to survive in this desperately competitive world which the container is now threatening, to start and think in terms of a total transportation system.

Mr. T. G. D. Galbraith: Does the right hon. Lady think, therefore, that she will nationalise all our sea-going ships as well?

Mrs. Castle: Perhaps the hon. Gentle man will allow me to carry through a serious argument. I am not running away. I am here to argue the Motion and gladly do so. But I want to argue it not against the background of prejudice and blind ideology of the party opposite but in the context of modern facts. The McKinsey Report points out

that there are serious obstacles to the achievement of this new concept which is vital for our survival. It sums up:
However, the fragmented nature of the industry"—
it is referring to transportation—
and the desire to protect individual segments of it, may impede the evolution to the low-cost transportation system that can be achieved. Thus, Britain should co-ordinate the activities of its various nationalised industries and regulatory agencies and establish a national policy for bringing the desired system into being.
I cannot imagine a clearer justification for the National Freight Organisation which I propose, the whole purpose of which is to re-knit some of the segments of nationalised transport which the Tories fragmented with such disastrous consequences. By welding the freightliner system to our nationalised road haulage network, we shall get a double advantage because the National Freight Organisation will then be able to offer both road transport, with its flexibility to operate on any route, plus the low-cost of the freightliner on standardised routes, the superiority offered by rail movement in moving freight having been demonstrated mathematically in this Report.
On my fairly recent visit to the United States, I talked to some of the rail and road companies and discovered that they envied us the chance to integrate our road and rail services. They are prevented by internal anti-trust legislation from doing so. That is why I intend to seize the implications of the container revolution and to carry it through in the new structure of our transport system—

Mr. Daniel Awdry: On her visit, did the right hon. Lady find that the Americans agreed that all practical policies must be Socialist ones?

Mrs. Castle: Yes, as a matter of fact. I said to some of the heads of the railway companies, "This is music to my ears. You are talking pure Socialism". I know that hon. Gentlemen opposite will retort, as did the hon. Member for Worcester, "We favour the freightliners and agree that they should be developed", but their approach is entirely different. They see them as merely a narrow, nationalised link in a chain of


transport dominated by private enterprise. When the hon. Gentleman tries to mobilise the backing and sympathy of the railwaymen and waves at me copies of the Railway Review, I would remind him that it is his and his party's concept of the freightliner that railwaymen have been fighting—the concept of the iron bridge which the private haulier can use when it suits his economy.
However, I have a very different concept—[Laughter.] Yes, and I am proud to declare it openly—it is that freightliners are a triumph of nationalised industry. If private enterprise owned such an asset, it would use it is as a springboard for vertical integration. Dr. Beeching indicated the commercial logic of that. Are we to put it into a straitjacket of Conservative policy? I believe that this kernel of our rapidly modernising nationalised transport system should expand and develop its own road services and establish close, integrated links with our nationalised ports and should get into the inland clearance depots and shipping by various means, including consortia.
This is the kernel of my policy and this is what I intend our nationalised transport services to do, thus ending what McKinsey calls the "functional division" which has limited the extent to which the concept of total transportation can be developed.
I have said before and say again—I do not intend to renationalise the road haulage industry. I have made this clear from the beginning and. despite what the hon. Member for Worcester said, I am not departing from it. However, I have been struck by the slowness of the private hauliers in taking advantage of the freightliner system, after we spent two years arguing in the House and with the N.U.R. about the important principle behind open terminals. Now, despite its economics, private hauliers are hanging back.
I do not intend to renationalise road haulage, but I do intend to exploit to the full the potentialities of our nationalised services We must not forget that, with its freightliner services, British Rail has led the way in containerisation, not only in this country but in Europe, and I do not intend that the advantages of that

flying start for our nationalised transport industry should be restricted.
Another significant fact which emerges from the McKinsey Report's economic analysis is that the economics of containerisation call for a major realignment between road and rail. It makes it clear that, for all journeys of more than about 100 miles, unit trains provide the "lowest cost mode" of inland transport. That is why one of the purposes of the National Freight Organisation will be to stimulate the maximum use of freightliner services, and there is no need to apologise for that.
But the Report also issues a challenge to private enterprise, saying that most importers and exporters—this goes for manufacturers too—have not yet given enough thought to the impact of containerisation on the economics of their own businesses. If we care about keeping Britain competitive, it is time that we read a few lectures to them, because transport costs account on average for about 45 per cent. of the cost of goods to retailers, and it is therefore essential that we reap every possible transport economy.
This is one of the points which I have in mind in drawing up my proposals for the reform of carriers' licensing, which will form part of my overall transport policy and part of the proposals which I shall eventually put before the House, and on which I shall be consulting the trade unions, transport operators and industry shortly. I shall be ready to circulate my proposals on carriers' licensing later this week, and, so that the hon. Gentlemen may enjoy their full benefit, I shall place a copy in the Library.
This Government have already given more help than any previous one in stimulating the development of the container trade. The Board of Trade's 25 per cent. grants for container ships and up to three sets of containers bought with new or converted ships, our 20 per cent. grants for harbour and port facilities and the fact that we have stationed Customs staff at inland clearance depots are all examples of this.
In the last, we are again off to a flying start, because about a dozen such depots are already planned and should be operating by the end of next year. We are investing more in our ports than at any time in our history. From 1952 to 1964, investment in ports averaged £18 million


a year. Last year, we invested £35 million and more and the estimate for the current year is of an out-turn of £45 million.
To meet the container traffic, we must have two things—positive promotion of port development, but under a carefully balanced national plan. I would ask the hon. Member for Worcester to think a little about the implications of the container revolution for port planning. It needs careful central thinking and planning. It is no good lightly playing off one port against another: the question is far too serious for that.
The question is whether we as a trading nation are to remain with major ports directly on the trans-Oceanic routes or are merely to provide feeder services—[HON. MEMBERS: "Hear, hear."] Hon. Members agree. I ask them to realise that, when the hon. Member for Worcester talked of our proposals as the basis for consultation on the nationalisation proposals, he made play with the fact that we were to have this strong National Ports Authority, responsible, he said, for finance, planning, investment, and pricing policy, and giving valuable common services as well to the ports for training, market research and computer services.
He laughed at that and asked, "What does it leave for the regional port authorities to do?" Of course, the answer is that it is important that the regional port authorities should not have endless interference from the centre in the details of day-to-day management. I would stress the critical importance of port planning and port policy in the years ahead if Britain is to remain in the container business.
So much for the nationalisation of ports and the so-called nationalisation of road haulage. The hon. Member for Worcester was even further from the mark when he talked about the passenger transport authorities. These are a striking and dramatic extension of the whole sphere of local government. The hon. Member smiles. He read out a document which had been put out as a basis for consultation. In fact, consultation has been taking place with some of the Conservative authorities to which he referred. I know that the Conservative Central Office have issued them all with a directive that on no account are they to play with my P.T.A.s, regardless of the advan-

tages which it might bring to transport in their areas. I recognise this attempt to get the central political objective interfering with the development of policies which are urgently called for by the conditions of transport and traffic in our main conurbations.

Mr. Peter Walker: Mr. Peter Walker rose—

Mrs. Castle: Before the hon. Member intervenes, let me tell him that, in my discussions with local authorities and with the local authority associations, I have satisfied them about a number of the scares which he has tried to arouse over some of the details which were a basis of discussion and certainly not a final document. This is a difficulty about debates in the House. On the one hand the House says, "You must consult. How dare you produce final proposals without listening!" On the other hand, when I produce interim proposals and listen, I am told that the "basis of consultation" is regarded as final proposals—when many of them have already radically changed. I have made an offer to local government and local authorities in this country that most of them are excitedly waiting to grasp, despite the attempts which the hon. Member is making to sabotage the operation.

Mr. Walker: No directive of any description has gone from the Conservative Central Office to local authorities. The right hon. Lady's statement is quite untrue. Secondly, why did the right hon. Lady publish her first document as a basis for consultations but make her second document confidential?

Mrs. Castle: I did not publish my first document. I am sorry—it was issued. There were various alternatives spelled out. We have been thinking—[Laughter.] I know that that is a strange occupation with which the hon. Member is not familiar, but I make no apology for telling the House that I have spent months in trying to think through the implications for my policy of the situation which exists in transport and traffic.
As the hon. Member knows, the initial document said that it could be done one way or it could be done another. I then went around the country and consulted and talked to local authorities and to bus operators. I said to them, "This is a confidential stage in which I am seeing


people in a varied sequence, and it is not fair for discussions and arguments to leak out before I have gone round the country". As a result of those consultations, I produced a clearer and more specific document, going into details but still on the basis of consultations—consultations which have taken place. Local authorities to whom I have spoken are now completely aware that what I am offering is an extension of the whole sphere of local government.
This is not nationalisation. It is municipalisation or regionalisation. I warn the hon. Member that he will get himself into rather a ridiculous position if he does not accept my assurance on this point, because if I wanted to advocate nationalisation, I should do so openly, just as I have done about the docks. If I had decided that the solution of the 1947 Act to create nationalised area boards was the right one, I should have come out and said so openly. But—and these are the practical objective facts of the situation with which we all have to deal—I know that public transport can be dealt with only in the context of a wide range of other local government responsibilities—highway planning, traffic management, development planning, overspill planning, industrial location and housing. If ever there was a subject which fitted naturally into the local government field, it is public transport. That has always been my intention, and the way to do it is what we are examining.

Mr. Michael Heseltine: The right hon. Lady said that she did not publish the first memorandum. As reported in column 1737 of the OFFICIAL REPORT, she told us that it had been placed in the Vote Office where we could examine it. The second memorandum has not been made available.

Mrs. Castle: I am sorry. I corrected what I had said. I said that it had been issued. The first document was an either/or document, but the discussions on it were confidential. The second document, which is still interim, was confidential, I agree, and perhaps I made a mistake in not placing that in the Library, because it has allowed the hon. Member for Worcester to get away with some more of his inaccuracies.

Mr. Peter Walker: Name one.

Mrs. Castle: Let me give one example. He took certain things out of context. Let me give one quotation about the financial aspects of the passenger transport authorities:
It is the Government's declared intention to embark on a deliberate policy of giving financial support to the development and improvement of public transport. This assisttance will be given primarily in the form of infrastructure grants, i.e. grants for public investment in public transport facilities, but also in other ways …".

Mr. Awdry: On a point of order. Is it in order to quote from a document which is marked "Confidential" and which has not been issued to any hon. Member? How can we possibly follow it?

Mrs. Castle: The hon. Member for Worcester has been getting away with that initiative for the last half hour. I was saying—

Dame Irene Ward: On a point of order. After a point of order has been raised, is it not generally the rule for the Chair to reply to it?

Mr. Deputy Speaker (Sir Eric Fletcher): Hon. Members were discussing the point of order. I understand that the right hon. Lady is quoting from a document in response to a request by the hon. Member for Worcester (Mr. Walker).

Mr. Nicholas Ridley: Further to that point of order. When a confidential document is referred to, it is normal for that document to be made available to all hon. Members—or else no quotations are made from it. We have no objection to the right hon. Lady quoting from it, but we should like an opportunity for all hon. Members to study all the document. She is putting us in a very unfair position. That was why my hon. Friends felt that she was taking advantage of them.

Mrs. Castle: The hon. Member could get a copy from the same place as that from which his hon. Friend the Member for Worcester obtained it.

Mr. Heseltine: As the right hon. Lady has admitted that she may have been wrong in not publishing the second document, may I ask her now to do so?

Mr. Deputy Speaker: In answer to the point of order, I understand the position


is that if the right hon. Lady were summarising a confidential document she is entitled to do so. If she was quoting in extenso from a confidential document, then, unless there are reasons of State to the contrary, it is in accordance with the rules of the House for the document to be laid.

Mrs. Castle: I am quite happy to lay this paper, but may I tell the House that it is completely out of date. Hon. Members are welcome to have it. The hon. Member for Worcester will be sorry to hear that the consultations have effectively taken place. Some of the points which he quoted as examples of how sinister we are will be found no longer to be applicable, but if the House wishes me to lay an out-of-date document, I am prepared to do so. In any case, so close is the relationship between the hon. Member for Worcester and Conservative authorities that he has access to it. I have nothing to hide here. I placed the ports document in the Library and I am placing the carrier licensing document in the Library. I have nothing to hide because I have given considerable thought to the details of my policy and I am only too glad to have the House set fully in the picture about what I have in mind.
The need for the strengthening and rationalisation of our public transport services is obvious. Look at the position that faces us. Already the number of vehicles on our roads has risen from 9 million only six or seven years ago to 13 million today. By 1970 there will be 18 million, and by 1980 there will be 26½ million vehicles on the roads. We ought to be preparing now to meet the challenge of that congestion, a congestion that will be even more overwhelming in our cities. Therefore, I would say that, with these passenger transport authorities, which are designed to extend the sphere of responsibility of local authorities, we are concerned with very much more than just the reorganisation of local bus services. The necessity is obvious.
Let me give the example of one conurbation where a passenger transport authority may emerge—S.E.L.N.E.C.—South-East Lancashire and North-East Cheshire. In that conurbation, there are 11 municipal bus services, one with only 12 buses and two with only 61, together

with three private bus companies. Can anybody in his right mind say that there is no need there to gather the services together and reorganise them?
The hon. Member for Worcester has fulminated in the Press that he will organise protest meetings in every town where bus services are threatened. Let me remind him that the last time he organised a protest meeting it was against the Midland Red Bus Company. I have here a cutting from the Worcester Evening News dated 3rd June. What is the heading? The heading is:
Mr. Peter Walker, M.P., calls at headquarters of Midland Red. Bus fares probe. Poor village services under discussion, too.
The article states:
Mr. Peter Walker, M.P. for Worcester, yesterday visited the headquarters of the Midland Red bus company and discussed the dissatisfaction of people living in Worcester and the surrounding areas with the rise in fares taking place on July 1, and the poor services, particularly in some of the villages.

Mr. Peter Walker: Will the right hon. Lady now read out the results of my probe and the reason I found for fares having gone up being in nearly every case Government action?

Mrs. Castle: I will only tell the hon. Gentleman that, if he cares to go through the files of the Worcester Evening News for the past six months, he will find that the most frequent entry is dissatisfaction with the Midland Red Bus Company. He refers to the reasons he found for fares going up. That may be perfectly true, but I could argue as against that that the municipal bus fares are considerably lower. He would then produce arguments to show why that is invalid. The simple fact is as I have stated, and I have plenty of particulars here.
Let me give a few comparative figures. The Birmingham City Transport Department charges 4d. for one mile—Midland Red charges 6d. For two miles Birmingham Transport charges 8d. and Midland Red charges 11d. For three miles Birmingham Transport charges 11d. and Midland Red charges 1s. 4d. So it goes on. I am perfectly prepared to agree that one could qualify some of those figures in certain ways. I am not trying to distort my argument. The hon. Gentleman is; he makes sweeping allegations about


how the passenger transport authorities are bound to push up the fares. They will have to push them up quite a bit to catch up with Midland Red.
The job of the P.T.A.s will be much wider than this, and it is this concept that excites the local authorities. Their job will be to draw up comprehensive plans to integrate road and rail services; to secure a better balance between road and rail. I ask those of my hon. Friends who are interested in the railway industry not to be frightened by the scares of the hon. Gentleman, who tries to pretend that it is a way to cut down the 11,000 route miles. One of the things I see the P.T.A.s doing is producing as part of their transport plan proposals for new rapid transit services, some of which could include new rapid transit railway lines. Of course, there may have to be some pruning of certain suburban rail services in order to make way for more modern railway developments. This is tie sort of concept now being considered in the Manchester Feasibility Study, to which my Ministry has contributed 75 per cent.
Therefore, I stand here and plead guilty, and quite cheerfully plead guilty, to giving the passenger transport authorities a wide range of powers to enable them to do their job efficiently. I shall give them powers to operate ancillary services of the sort that go naturally with the transport job they have to do, whether it be the setting-up of vehicle repair shops, the running of refreshment rooms and bookstalls at bus stations, the provision of a parcels service—something, incidentally, which the municipal undertakings already have the power to provide; or run taxi services, or enter into agreements with taxicab operators to give, perhaps, a more flexible and more reasonably fast service as part of an organised transport plan.
I intend to authorise the public transport authorities to organise ferry services, hovercraft services, hire car services, express bus services, tours and excursions—all in competition with private enterprise because, unlike hon. Members opposite. I do not believe in a system once brilliantly described by my hon. Friend the Member for Leek (Mr. Harold Davies) on one occasion—nationalising losses and privatising gains.
If we are to have the extension of public ownership, the publicly-owned body should have as much freedom as private enterprise to enter into some of the more profit-making activities. I therefore intend to give the public transport authorities powers to acquire compulsorily bus undertakings, or individual routes as part of their overall transport plans.
There is a very profound difference of view between me and the hon. Member for Worcester. I do not care what tag he puts on it. The difference lies in the principle in which I profoundly believe. I do not think that public transport today is an appropriate medium for profit-making. Rather, it needs help from public funds. This is what we intend to give it.
The hon. Gentleman, and the Conservative Party, had better come up to date to meet the challenge that faces us in our cities. The problem is too serious for us merely to make party political points. We have to evolve appropriate and courageous policies. My impression is that local authorities throughout the country, knowing how much local government is being squeezed out of so many activities, will respond to my invitation to come in, and take these new powers, and give their local people transport at a level they have never yet had.

5.9 p.m.

Sir Robert Cary: The right hon. Lady's speech—which, if I may say so, the House has enjoyed—has proved one thing, and that is that she is a thorough-going deep-dyed Socialist. Although she has made some qualifications in the line she now proposes to take, I think that she did one grave disservice to the House and to transport by making no acknowledgment of the work of her predecessor but one, my right hon. Friend the Member for Wallasey (Mr. Marples), when Minister of Transport, and the companion he appointed. Dr. Beeching, who did so much to foster plans and procedures which the right hon. Lady and her friends now enjoy. They boast of their successes, but they took the unpredictable step of dismissing Dr. Beeching.
The right hon. Lady pleads that she is not nationalising transport, in the case of the road hauliers, that is to say, but in


all other aspects of the Bill which she proposes to bring to the House next Session there will be large sectors which will provide for new areas of public ownership. If she is to proceed along those lines, by the creation of her conurbations allowing public transport authorities based upon the municipalisation of transport, she will not be changing the ends of her party's policy but only changing the means.
In transport, with all its complexities and all its patterns, various and contrasting, it is not a simple matter merely to nationalise. In gas, steel, electricity and coal that can be done in one single operation, but in transport it is crude nationalisation—I think the right hon. Lady once described it as the primitive method—and she is seeking other means by which she can come to the same end, which is the outright public ownership of the transport fleets of the country.
My hon. Friend the Member for Worcester (Mr. Peter Walker), in the clear analysis he made when opening the debate, put his finger on many aspects of the right hon. Lady's policies. As she well knows, I am concerned with only one aspect, the bus operating industry, which I have known for many years and with which I have been deeply concerned. In the few minutes at my disposal I wish to deal with that aspect of the Bill which the right hon. Lady is proposing to bring here next Session. In this Session the crown piece was nationalisation of the steel industry. I assume that in the next Session the crown piece in the Government's proposals will be the Bill to which the right hon. Lady referred this afternoon.
I was left quite breathless by the astonishing sweeping statement made by the right hon. Lady. She accused my hon. Friend of making extravagant and sweeping statements, but I have heard no more sweeping or extravagant statement from any Member of the Labour Party than that the facts show that only Socialist policies are acceptable in transport for the future. There may have been a slight variation at the end of the statement, but that the right hon. Lady should think that only in terms of Socialist policies can we have the fulfilment of the needs of our people met is astonishing.
I have some different testimony to place before her this afternoon. She is familiar with it. It was also made by my hon. Friend the Member for Worcester. This year we had a paper laid before us, which was referred to by my hon. Friend who opened the debate. It was written by Mr. Glassborow, head of the Economic Research Department of the Transport Holding Company. No doubt the right hon. Lady and the Parliamentary Secretary have read that paper. I listened to its presentation. There are some significant passages in it. On page 13 of the paper Mr. Glassborow said:
I have argued so far that a single conurbation authority is not only unnecessary, because any greater degree of co-ordination between public passenger services than at present exists can be achieved more simply, but also undesirable because it brings diseconomies of scale, removes that element of choice and competition which at present exists, produces excessive standardisation in bus design, in patterns of operation, in systems of payment and in fare scales.
That is a sweeping condemnation of what the right hon. Lady said about the future of the conurbations.
I turn to the integration of bus undertakings which at the moment are beautifully balanced in terms of the private operators and the municipalities. As the right hon. Lady knows, I speak not only as one who for many years has represented in this House part of the city of Manchester which has one of the finest municipal fleets in the country, but also as chairman of a large operating company which shares many of the routes with that same fleet run by Manchester Corporation.
In the circumstances of the paper laid before us by Mr. Glassborow, to uproot the existing structure of operations as they are discharged at the moment by varying companies great or small, in terms of trying to satisfy public need and to match that need with a reasonable scale of fares charged to the public, I think the right hon. Lady will agree that to take these authorities, be they municipal or private and mix them all under one public transport authority leaving in their wake confusion and often dismay, is not the right way to proceed if we want to benefit the future of public transport.
I would rather that the right hon. Lady embarked on policies on which I cannot elaborate now. The plan she outlined this afternoon will take many years to realise. I hope that before one-tenth of those plans are realised present Government will have gone and that the Conservative Party will have an opportunity to participate in the unfolding of the Bill, which no doubt she hopes will be passed next Session, so that much of the damage which could be done in terms of conurbations may be stalled and sometimes eroded.
I am concerned about the highly organised technical staffs which exist in the municipal field and the private field. I have worked with many of them and I know their problems. The right hon. Lady is crying for the moon when she asks at this stage for a higher degree of perfection in public service transport by merely bringing in the Bill, calling it a reform and thinking that through that medium she is providing a better service. I hope that the right hon. Lady will produce a White Paper in August, as earlier in the year she indicated she would, and that we shall have the Bill published about September.
The Bill no doubt will take a high pace among items in the Gracious Speech and we shall have our first opportunity to comment upon it on the debate on the Address. I cannot wish it well, but, because of the majority enjoyed by the right hon. Lady and her hon. Friends, I have no doubt that if this Parliament survives the Bill ultimately will receive the assent of the House of Commons. Whether I vote against it or not is neither here nor there for the moment, but I shall obviously vote against it, although I can detect some merit in parts of it.
I beg the Minister to be careful not to attempt, through the Bill, to impose upon municipalities proceedings which they would resist. It is not in the interests of the ratepayers of Manchester for its great capital asset of a fleet of 1,250 vehicles, worth £10 million, to be seized by a public transport authority. Although Manchester carries with that fleet a loan debt of about £2½ million, a capital asset of that magnitude enables such a loan debt to be discharged. Salford, Manchester's neighbour, with practically no loan debt, successfully operates its fleet. The smaller unit at

the side of Salford—Bolton Corporation—in the last financial year made a profit of £57,000.
These are business assets which both the councils and the ratepayers may wish to keep. Yet, perhaps against the wishes of many ratepayers in the area and conurbation indicated by the Minister, it will be possible to get a Bill on to the Statute Book, despite the fact that many of the local authorities, which changed their political complexion in the last few months, do not want these proposals to come to fruition.
I cannot hope and pray that, when the Minister presents the Bill, it will fail, but I beg her to revise some of its provisions concerning the public transport authorities.

5.23 p.m.

Mr. R. C. Mitchell: I listened with great interest to the fluent, although perhaps over-long, speech of the hon. Member for Worcester (Mr. Peter Walker). Although his speech was at times amusing, it was devoid of content and contained no constructive statements. I had hoped to learn something about the Tory Party's alternative transport policy. Alas, I was to be disappointed. I am driven to the conclusion that the Tories have no transport policy in opposition just as they never had one during their period in office.
When the hon. Gentleman spoke of ports and docks, his speech was also completely devoid of knowledge. He spoke from the wrong standpoint. He seemed to think that the problem was one of competition between our various ports. Not so. The problem is one of competition between the ports of Britain and the continental ports. If we are to survive the container revolution, we must have a system of modernisation and planning for our ports as a whole.
The hon. Gentleman had the sauce to accuse the Government of cutting the investment programme in the ports. Until Labour came to power, there was not an investment programme in the ports. Up to 1964 port investment was running at an average of only £18 million a year. This ridiculously inadequate sum is one of the main reasons why we are in our present difficulties. There was also a lack of planning.
When the ports are reorganised and nationalised, a strong central National Ports Authority will be essential. Much of the hon. Gentleman's speech was devoted to accusing the Minister of being a Left-wing Socialist. No one has ever accused me of being a Left-wing Socialist, yet I fully support these proposals. If any industry is ripe for public ownership, it is the docks and ports industry.
Nationalisation has not been an ideology for me. It has always been a means towards efficiency. I believe in the nationalisation and public ownership of some industries, but not all industries. I had doubts about certain proposals which the Government made earlier this year, but I have no doubt that the port industry is ripe for nationalisation.
The national ports authority will have to make some difficult decisions—for instance, of the type made about Port-bury. Some hon. Members opposite think that the Portbury decision was wrong. I believe that it was right. The authority will have to assemble the resources available for port development and put them in what it considers to be the most efficient places. For some ports it will be unpleasant. I think that we have too many small ports. It may be decided on economic grounds that some of the smaller ports will have to close. These difficult decisions will cause heart-burning., particularly for the hon. Member in whose constituency the port concerned is situated. Nevertheless, the National Ports Authority must be responsible for the central planning of development and investment.
I want now to be a little critical. Paragraph 9 of the working document on the reorganisation of the ports, which was issued recently by the Ministry, says this:
It is important, as far as possible, given the predominance of London and Liverpool, to achieve a balance between the regional port authorities. The R.P.As must be of sufficient size and financial strength to be able to manage their affairs effectively, adopt modern management techniques, and provide adequate scope for investment and development.
The document then lists eight regional port authorities.
I doubt whether some of the regional port authorities as proposed will be able to do the job which the opening para-

graph of the document sets for them. Too many regional port authorities are proposed. I favour the proposal, which has been supported by certain expert bodies, for three authorities, under the central direction of the National Ports Council—one authority for London, one for Merseyside, and one for all the rest. The British Transport Docks Board has shown that it is possible successfully to manage ports which are widely diffused all round the country. I do not know what is the concept of a region in relation to ports. Take my own port of Southampton. It comes under a regional authority which includes Portsmouth, Dover, Shoreham, Poole, Weymouth and many other places. These ports have little in common. Therefore, I can see very little reason for their regionalisation. I would prefer to see, under the National Ports Authority, the three areas that I mentioned earlier.
The document to which I have referred goes on to say that the regional port authorities shall consist of between six and 10 members. I hope that it will be six rather than 10. I have always believed that within reason the smaller the body concerned with administration and management the better.
One of the difficulties of our ports has been the preponderance of the user influence. There is on the various bodies all sorts of people often with special interests rather than with special knowledge, and this fact has bedevilled the proper management and development of our ports. Anything which will free managerial functions from the user influence will be welcomed.
The document goes on to talk about worker participation. Much has been said in the past and many documents have been written about the method of worker participation which we should have in the ports. I would rather see a type of consultative system whereby dock workers are consulted at all stages, but without direct representation on the R.P.A.s or on the National Port Authority. This document contains five suggested possibilities for worker participation. My preference is for the consultative procedure at all levels rather than direct representation on the body itself.
One of the effects of the Docks and Harbours Act which was passed earlier this year is to reduce the functions of the


National Dock Labour Board. This will mean in many ports some redundancy amongst the employees of the National Dock Labour Board. I plead with my right hon. Friend to ensure that proper treatment is given to those who are made redundant. There is some indication that they are not receiving as good a deal as they should receive when they are made redundant.
Another point in this document which does not appear clear is who, under nationalisation, is to be the employer of labour in the ports. Nowhere in the document can I find any definite answer to this question. Are we to have a licensing system as we have under the Docks and Harbours Act? Those of us who considered the Docks and Harbours Bill in Committee were assured that this was purely a temporary measure until public ownership was introduced. If this licensing system were made a permanent feature, I do not think it would be acceptable to dock workers. We must have one employer, that employer presumably being the regional port authority.
The mystery about this debate is why it ever took place. It is difficult to find out why the Opposition chose this Motion for their Supply Day. They have not made any constructive proposals. Instead, they have made a purely negative attack on the Minister. My right hon. Friend, in my view, is the best Minister of Transport this country has had for a very long time, and yet the Opposition appear to be directing a personal attack on her. The Opposition are trying to develop a bogey woman in the country, the sort of thing they tried to do with Nye Bevan at one time.

Mr. Peter Walker: The only insult I directed to the right hon. Lady—if the hon. Gentleman considers it an insult—was to describe her as a Left-wing Socialist, and this was a quotation from her own words.

Mr. Mitchell: I am sure my right hon. Friend would not consider it an insult to be called a Left-wing Socialist. Nevertheless, the hon. Gentleman attacked the Minister and her policies throughout his speech. As I say, it is very difficult to understand the purpose of this debate. I hope that some of the points I have made

will be regarded as constructive and will receive a reply.

5.36 p.m.

Mr. Ian Lloyd: I ought to start by setting the record straight in one important respect. The Minister implied that during her visit to the United States she met many people who were in favour of nationalisation as an answer to the problems of radical changes in the transport system. Mr. Gulick, the acting maritime administrator in the U.S. Department of Commerce, wrote an article in which he quoted the American Secretary of Transportation, Mr. A. S. Boyd. The article said:
In presenting his programme, Mr. Boyd declared: 'It is clear that two things must not happen; the maritime industry must not be allowed to die and it must not be nationalised. To do nothing would assure the former and to meet everyone's demands would require the latter. A productive and revitalised merchant marine obviously makes good sense and can benefit every American and every industry … this programme was designed to answer the questions that have plagued the merchant marine for the past several years. We must keep pace with the advancement in streamlining and co-ordinating transport administration and regulation. We must take full advantage of the revolution that is occurring.'
Clearly, it is the view of the most senior man at the permanent levels of the Maritime Administration that nationalisation is not required. This point has been more than adequately emphasised.
I turn to another point that was made by the Minister. I was astonished, pleased as I always am to hear someone in this House beating the drums of containerisation, to hear the Minister proclaim that in some way this was inevitably joined with nationalisation. I am not sure what the right analogy is—whether it is a young bride appearing in the dress of a Japanese war lord, or King Kong appearing in bridal dress—but, whichever is the right analogy, this is the situation which the Minister has described.

Mr. Ridley: Does not my hon. Friend think that she has confused the container revolution with the Socialist revolution?

Mr. Lloyd: My hon. Friend has made the point which I was coming to. The Minister implied that there has been a certain reluctance to accept this technological change in this country, and she attempted, in some senses rightly, to give


credit to the British Transport Docks Board for what it has done. Nobody will dispute that the Docks Board has done some useful things. The commission of this report by McKinsey was useful, and the change of attitude towards containerisation, not only in the Docks Board but in other widespread sectors of the industry, is only to be welcomed.
I have the strongest recollection of returning from the United States in the early 1960s, when, as chairman of the International Cargo Handling Association in Britain, I was trying to bring people to realise what was happening and what was about to hit this country in transport, and having to drag the British Transport Docks Board by the scruff of the neck to our meetings. This should be emphasised. My memory is rather long in these matters, and I am not prepared to leave unanswered a Minister who proclaims in the House that, suddenly, it is the nationalised sector which is embracing the new technology. With respect, that is the most arrogant nonsense that I have heard in the House for a long time.
Nationalisation is of three kinds. There is nationalisation by proclamation. All of us in the House have had some experience of it. With no sense of shame or irrelevance, the Government spokesmen come to Westminster like muezzins to their minarets and call the faithful to legislation, leaving the Opposition to pray for the country. Then we have nationalisation by accident. This happens when the Government discover, happily for themselves, unhappily for the country, that it is difficult or impossible to disentangle a sector intended for nationalisation from sectors which, at some stage, we were assured were not intended for nationalisation. Steel has presented many problems of this sort. Transport will present many more. This Government are accident-prone to the point where their intentions in these matters cannot be regarded as wholly innocent. Indeed, some might argue that their licence to drive at all should be withdrawn. Then there is nationalisation by stealth. This happens when innocent little Measures like the data processing Bill are allowed to slip through at morning sittings.
My concern today is with the nationalisation of the ports and port industry, and there can be no doubt into which category this falls. The Minister's working document on the reorganisation of the ports proclaims the faith with all the subtlety of a sonic boom. We knew that the boom was on its way, but that makes it no more acceptable or desirable. Indeed, the only sort of boom which this Government seem able to create is a boom of nationalisation, and, if I may say so, it is a chronic boom closely associated with the chronic state of the country's economy.
I shall not repeat the whole range of arguments which I used on a previous occasion in dealing generally with the ports industry, arguments which are just as relevant today though still unanswered. I then explored the utter irrelevance of nationalisation to the main problems facing the ports. What I propose to do today is to examine, first, some of the philosophy underlying this extraordinary document, so faithful a replica of the propaganda of the hon. Member for Poplar (Mr. Mikardo) that I am reminded of the old H.M.V. gramophone label.
Second, I shall consider some of the implications of these proposals for the numerous industries and commercial interests which are affected by them. We have heard very little about this from the Minister today. Again, the Minister is not wholly innocent of the accident-prone characteristics of these proposals. Finally, I shall suggest where, in my opinion, the real challenge lies and what this or any other Government must do to meet it.
The key to the document lies in paragraph 1, the covering paragraph of the preamble. It tells us so much about the mentality of the right hon. Lady that I am reminded of a phrase used by the philosopher Bossuet who, the House may recall, advised us to know ourselves "to the pitch of being horrified". I see that the right hon. Lady is not here; otherwise, she might be blushing. At least, the Joint Parliamentary Secretary is given by nature a protection from that sort of reaction.
Let us examine with care what the document says. It does not deserve


examination with care but, unfortunately, it certainly requires it. There are three key phrases. We are told that the part played by the ports must, in the first place, be viewed nationally. That is an unexceptionable sentiment. The National Ports Council does just that. Second, we are told that it must be "planned positively". In this context, as in all others, both those words need the most rigorous definition. Third, we are told that there must be a
unified control of policy … to replace the present fragmentation of development".
Finally, we are told—I come back to the point with which I began—that the container revolution
has as one of its consequences the need to plan the future development of our ports on a national basis.
This statement, too, needs rigorous examination.
Let us start with the national view. The National Ports Council has endeavoured to provide this, with some success. Its views merit respect. Its rôle regarded as indicative, and, in its most recent Report, the Council itself suggested that this should be viewed
in terms of a structure of information about and interpretation of present and future demand patterns".
In my view, the structure merits considerable research and attention both in the ports and in any other major sphere of industrial development.
The National Ports Council has made a good beginning. If it is abolished, someone else will have to continue. I wonder whether its abolition has come about because, having had experience of the magnitude and complexity of the problems, the Council concluded in its most recent Report:
It would be unrealistic to try to plan to cover every contingency"—
this from the body most concerned with our ports in the last four years—
There must, in short, be an ability and willingness to deal with unforeseeable functional demands ad hoc. The Council have therefore decided that they must concentrate their planning effort at each stage on the most critical elements in the problem.
I regard that as a most significant statement, which explains a great deal.
It seems to me that all decisions, wherever made, about ports and shipping

tend to benefit the country if the work is well done, but I do not believe either that the work will be improved in scope, quality, reliability or relevance if the National Ports Council's staff are incorporated merely a s an information division of the National Ports Authority, or that the great and dangerous leap into the dark from so-called indicative to so-called positive planning will thereby be any more justified.
What do those two words mean? In this context, "positive" means merely that the decisions which the available management information seems to call for are no longer decentralised. Whitehall now takes the view. Whitehall now takes the decision. Whitehall now spends the money. The use of the word "positive" provides absolutely no guarantee that the view will be wider or the perspective longer, that the decision will be wiser or nationally more beneficial, than the aggregate of separate responses or decisions which it replaces. The word "positive" alone provides no guarantee that the money will be better spent. Others will merely be stopped from spending their money so that someone in Whitehall can spend it for them, probably in another place and in an area over which they have no control.
The use of the word "planning" in this context—one of the most dangerous in the whole vocabulary of politics, as encrusted with semantic overtones as a 17th century wreck encrusted with barnacles—makes no necessary contribution under any of these heads. For what can planning, whether in port development or anything else, be other than the taking of decisions to allocate available resources in the light of two factors, first, the available information about the environment most concerned, and second, the impact of political and economic pressures from within the same environment. The Minister did not mention that the whole spectrum of political and economic pressures will continue to operate exactly as before. They will not be exorcised or eliminated merely by the process of nationalisation, and the House should consider this carefully.
What the argument is about is merely obscured by the use of the phrase "positive planning". These are the proposals as I see them and which the House


should discuss: first, to centralise information; second, to centralise the discussion of policy; third, to centralise the allocation of resources; fourth, in very large measure to strip the present ports, however controlled, however efficient or inefficient, whatever their resources, of control of their own destiny. I am glad to see that the Minister has returned to her seat, because she will not deny this.
No more in this sphere than in any other can the centralisation of resource allocation or of significant areas of operational decision, at the inevitable expense of local initiative and judgment, be justified by the inane incantation that it is positive planning, and therefore in some ways a form of economic Holy Writ. There may be a strong case in national port planning for a unified view of policy. There may be a limited case for unified control of policy, but the control does not require nationalisation, for the National Ports Council and the Ministry of Transport already exercise it between them in considerable measure. Certainly it does not justify nationalisation.
What we need is to substitute for an inadequate pattern of dispersed decisions on port operation and development, a greatly improved but still fundamentally dispersed pattern of decision-making and resource allocation for the ports industry. I concede that there is room for a great debate about the extent and significance of the word "inadequacy" in this context. This requires not nationalisation but the better informing of judgment, the better encouragement of initiative, the improvement of communication between the ports and all those whom they serve and who serve them, and a better stimulus to technological change. I would wholeheartedly and without qualification accept these requirements. This is what is needed, and if the Government could demonstrate that it is what will be achieved I should almost be tempted to go into the Lobby with them, if I were not suspicious. In any case, I am confident that they will not demonstrate anything of the kind.
All those requirements tend to respond better to procedures oriented towards decentralisation. If there is a lesson to be drawn from practically the whole body of experience and literature, not only from the United States but wherever

big industry operates, whether private or public, it is that decentralisation is fundamental to efficiency, and not the other way round. The proposal is for centralisation, and I dispute with any hon. Member that it can be described in any sense as anything else. None of the requirements is guaranteed to be met by centralisation. We know from experience in a wide sphere that many, not only in the ports industry, are seriously inhibited by it.
I now turn to the container revolution. We are told that one of its consequences is a need to plan the future development of our ports on a national basis. That is a statement; it is not an argument. In my view there is not a shred of evidence to sustain the argument if it were made. In the past few years I have been to most of the major container ports in the world. As the Minister knows, I have been to the following operational container ports among others: Port Newark, San Juan, Honolulu, San Francisco, Rotterdam, Amsterdam and Antwerp. I have not been to Cam Ranh Bay, which I am told is one of the most exciting maritime operations one can see today.
Although many of those ports have been developed by public and municipal authorities, as far as I know not one has been developed as a result of nationalisation, and in not one of those areas is nationalisation contemplated. Of the projected major container ports of the world, I have been to Skandiahamn, Tilbury, Southampton and Liverpool, and I have seen the Fos area in the Mediterranean. This is the one exception, because French ports are nationalised. I have also been to Rivalta Scriva, Hamburg and Bremen. With the exception of Fos, nationalisation was not thought necessary, and it is not contemplated or a condition of establishing the container revolution.
I should now like to deal with container inland depots. I have read the Report, which I consider to be very good. In many respects the inland container depots are a more important feature and requirement of the container revolution than the old-fashioned port areas as we know them. The depots will frequently be privately owned. A great majority in the world today are privately owned, as


far as I know. They require considerable capital investment.
The Government are encouraging the capital investment, but the document clearly contemplates their incorporation in a nationalised scheme. I hope that the Minister will deny this. It would give me great pleasure and it would be a great reassurance to those making their investment if she can reply in that way. But the document says that regional authorities must consider the incorporation
… of those assets and operations that serve the generality … of shipowners and shippers.
The N.P.A. is enjoined to keep non-nationalised port transport facilities and services under review with a view to recommending nationalisation. The regional authorities are asked to exercise similar control over
… independent services and facilities in the ports.
This could cover anything. It certainly covers inland container depots, and could even cover the ships that serve them. I hope that the Minister will give a resounding negative to my supposition, if she is willing and able to do so.
The point is that time is of the essence. The main investment in containers is already committed. Critical amounts of capital have still to come, and may be poised dependent on the type of policy decision made. Success in this as much for Great Britain as for any other country will depend on those who establish effective operational services first. The year 1970 is much too late. The Minister knows that two of our major operations are due to he launched before 1970. They must be under way, operational, successful and undamaged and uninhibited by announcements about nationalisation. Do the Government seriously think that the best way to encourage the container revolution in this country is to hang a sword of Damocles of nationalisation over its head? If the Minister thinks that, I hope that she will say so.
Another point in the document is that there is clearly established a remarkable hierarchy of control. Again we have the centralisation of power—a National Port Authority with eight to twelve members appointed by the Minister and regional port authorities with six to twelve members again—I ask the House to note—

appointed by the Minister. Note the composition: the National Port Authority is to have trade union representation. I do not think that anyone would take exception to that, but the novel element enters on the regional port authorities. They face
… a statutory obligation to arrange consultation and negotiating machinery and worker participation.
[An HON. MEMBER: "Hear, hear."] This may be regarded as an ideal by hon. Members opposite, but if the question of workers' participation is to be brought into the nationalisation of ports fundamental consideration by the House is required. We are told in the document that the workers are to be—and this is why I suggest that this is so important—associated with the management of day-to-day operations. They are not to be consulted but associated with the management of day-to-day operations and they are to be represented on the regional port authorities in addition to having their trade union representatives. This is a fundamental change in our national thinking about matters of this kind.

Mr. John Ellis: With regard to workers' representation, since they do all the work, does not the hon. Gentleman concede that they may have some contribution to make?

Mr. Lloyd: I have always conceded that it is desirable to give those affected by management decisions some say in them, but if they are to sit boards of directors they must share the responsibility, and how that is to be done I am not sure.
The document says that legislation is to be provided to permit the industry to apply the lessons learned. I hope that the Ministry will take an early opportunity to explain to the House what is meant by this.
Who else is represented in the new hierarchy of control? The shipowners? We heard the hon. Member for Southampton, Test (Mr. R. C. Mitchell) deride the contribution which user interests had made to the ports. I am the first to concede that at times and in places some user interests have been reactionary. But can it seriously be maintained that the representation which some of the great liner companies have


given in the ports from Glasgow down to Southampton over half a century or more, where their great knowledge has been brought to bear about the operation of port facilities, has not been of value? Surely this has not been of such little value that in the new set-up it is to be ignored.
Where are the industrialists represented? There are no industrialists represented as of right, though some may be appointed by the Minister. Where are the commercial interests represented? Some may be appointed by the Minister, but there is no representation as of right. What sop to Cerberus is given? We are told that the right of users to object to high charges will cease to exist. We are told that this is because the Government's general policy on justification and examination of prices should provide an adequate framework of protection. I am sure that I need say no more.
We have here the substitution on the largest scale of promises for rights, and this is not something which this side of the House would support. What mention is there of the most fundamental question over which the Ministry of Transport should have some control and about which it should be doing a great deal? What mention is there of docks and roads? None at all. One of the things that struck me during recent talks at major ports was that those who were handling their problems most successfully were those in which the Departments most concerned were co-operating in an effective scale of provision of major road systems to ports. The Ministry should be doing something in this direction. I should have liked to see something much more specific in the document, but there is no mention of it. What about the distribution systems which are required? What about Customs and documentation?
It is of particular interest to me that the McKinsey Report, which contains not one word of nationalisation, suggested that it was in the interests of the United Kingdom to initiate national agreements designed to simplify the existing administrative procedures for getting a smooth flow of international cargoes. Perhaps we might be told what the Minister is doing in this respect. The Report states that in the long term a new form of international

regulation of the industry will be required. It would be interesting to know whether the Ministry is exploring what these new forms are and is informing the House about it.
Where is the systems analysis? We are told that this is very important. Where is total systems analysis most highly developed? Almost certainly it is in the United States at the Stanford Research Institute, the Rand Corporation, Tempo and other organisations. What could be more effectively integrated in transport terms than the whole complex connecting Honolulu and the West Coast of the U.S.A. and Puerto Rico and the East Coast of the U.S.A? Integration there is complete.
My last word is on rationalisation. The McKinsey Report points out that rationalisation is best achieved by the voluntary co-operation of those concerned when provided with the right type and quality of information about all their joint decisions—joint investment planning, and so on. Rationalisation, yes; nationalisation, no.

6.5 p.m.

Mr. Roy Hughes: The Government have now been in office for nearly three years, and some of us on this side of the House are perhaps honest enough to admit that in some ways at least they have not come up to our fullest expectations. There are reasons for this, of course, not least the fact that they were left a debt of £800 million by the previous Conservative Administration. The Government have experienced great difficulties, but they have not been without their success stories.
I believe that it was Queen Victoria who once described one of the overseas possessions as the greatest jewel in the British crown. Today I suggest that a similar description could be applied to the Ministry of Transport in relation to the present Labour Administration. I agree that some of the proposals emanating from the Ministry from time to time are controversial. This is understandable because today almost everyone seems to be vitally interested in transport.
The Ministry is led by a most able team of Ministers. I am not asking the House to take my word for this. On 13th July that highly influential journal, the Daily Telegraph, carried a feature in its


London Diary headed "Mrs. Castle's Tricycle". Hon. Members will not need me to remind them that this journal has not built its reputation on its Left-wing leanings. But it had this to say about the team at the Ministry of Transport:
This looks and probably is the strongest team the Government can field from any Department just now.
It goes on to say about the team:
All three are articulate—none more than the leading lady—all three seem to know their homework and together, as they were yesterday, form a tricycle through the wheels of which spokes are hard to put.
One can, therefore, begin to understand the Opposition's resentment at this success story and the reason for the barbed criticism which underlies the Motion.

Mr. David Webster: There is no resentment, but we rather think that a better expression would have been "troika".

Mr. Hughes: After listening to the hon. Member for Worcester (Mr. Peter Walker), who, after all, is his party's spokesman on transport, one becomes ever more convinced that the Conservative Party has no policy on transport to offer the country. The attitude of the Tory Party to public ownership is traditional; it has worshipped at the shrine of private profit for so long that it has come to believe it to be sacred. On the other hand, the growth of private monopoly does not trouble the consciences of hon. Members opposite. The Conservative Party seems to have reached a stage where the only occasions on which it is united is when it is attempting to prevent an extension of public ownership or to undermine existing publicly-owned industries.
Far from decrying any proposals the Government may make on public ownership, I welcome them. Particularly do I welcome the proposal to take the docks industry into public ownership. On 20th February, I asked my right hon. Friend when she proposed to take it into public ownership and she said that she hoped to achieve this by 1970. I am pleased, therefore, that in the memorandum issued by the Ministry two weeks ago it was confirmed that, provided that legislation is introduced in the 1968–69 Session, the vesting date for public ownership will be 1st January, 1970.
The Government have accepted the principle that in their endeavour to create an integrated transport system our ports must be reorganised on the basis of public ownership. A unified control of policy is essential to prevent continuation of haphazard development. Decisions relating to our ports will affect the wellbeing of the whole economy. Such decisions cannot be taken except on the basis of positive central planning.
In the municipally-owned port of Bristol, there is a certain amount of concern about the Government's proposals. From the point of view of civic pride, this is understandable. Bristolians were disappointed by the rejection of the Portbury proposals. There is also the fact that my right hon. Friend proposes that the Bristol Channel ports should be organised on an estuarial basis—in other words, that the port of Bristol should be linked with the South Wales ports. Perhaps, therefore, Bristolians are concerned lest they shall come under Welsh hegemony and direction.
The fascinating aspect of the Bristol saga is that the Tory party has emerged as the champion of municipalisation. Speaking as a former city councillor, I can tell the House that never have there been more ruthless opponents of municipal enterprise than the party opposite. That, of course, is consistent with its political philosophy. I say to my Socialist friends in Bristol, "Beware of the Greeks bearing gifts".
The Government feel that it is not necessary for all the ports of the country, large and small, to be brought into public ownership, but the position should be carefully watched because some of the smaller ports are developing fast, particularly so now that the container revolution is well under way.
What is more, these smaller ports are not bound by the basic minimum standard rates and conditions of employment. It is, therefore, in this light that I welcome paragraph 16 of the Ministry's memorandum which states:
Each regional port authority will have a duty to keep under review all ports or port facilities in its region. Regional port authorities will be empowered to submit schemes through the N.P.A. to the Minister for taking over further ports and facilities with a view to securing the improvement, maintenance or


management of a port, or a region's ports, in an efficient and economical manner.
I am pleased about those proposals.
I ask my right hon. Friend to be careful in the assessment of compensation. This is an issue which, over the years, has tended to undermine the success of the nationalised coal industry. While I appreciate that the sums involved in docks nationalisation are very small in comparison with those involved in the nationalisation of the coal industry, it is nevertheless worth pointing out that, from the start, the coal industry was over-burdened with interest payments and, indeed, with interest payable on the original interest. Compensation was paid over the years to coal owners for collieries which had been denuded of capital investment over several decades and many of which had to be closed down very soon after being taken over. I trust, therefore, that this time the Government will learn from experience in public ownership.
I also urge the Government, when selecting the National Ports Authority and the regional authorities, not to fill these posts with people unsympathetic to public ownership. Again they should learn from experience. We have seen what one Macdiarmid could do in the steel industry and we do not want the story repeated in another publicly-owned industry.
I come finally to the question of worker participation. In publicly-owned industries, the Government should ensure that workers are allowed to play a full part in the management of the industry in which they obtain their livelihood. By doing so, they will be setting an example for private enterprise to follow. It goes without saying that there should be full consultation at the formative stage of important decisions, not after decisions have already been arrived at.
At present, there is renewed interest in industrial democracy. The recent Iron and Steel Act took account of that, as does the plan for the reorganisation of the Post Office. There is certainly a need to extend industrial democracy and I welcome such proposals. Over the years the docks industry has had more than its fair share of bitterness and industrial conflict. The decision to

end casual labour will no doubt present many problems, but in the long run it will prove to be one of the more enlightened decisions of the Government.
I speak as Member for a docks constituency. In Newport, we are proud of our publicly-owned docks. Just over two weeks ago, we had the privilege of a visit by my right hon. Friend and I believe that she was impressed by what she saw. On Friday this week, the hon. Member for Worcester is visiting my constituency and its docks. Seeing that he is his party's spokesman on transport, I hope that his visit will help him to appreciate the benefits of public ownership. If it does that, the visit will not be in vain. Meanwhile, I hope that the House will treat this Motion with the contempt that it deserves, for it is merely an attempt to divert the Government from their endeavours to place the British economy on a sound footing.

6.20 p.m.

Mr. Peter Bessell: I am glad to follow the hon. Member for Newport (Mr. Roy Hughes), even though I do not agree with very much of what he said, because at least his speech had the merit of sound logic from a Socialist point of view, and a great deal of synthetic heat has been generated during the debate on both sides of the House.
The most important statement which has emerged so far is that of the right hon. Lady when she said that the only practical proposals for transport are Socialist ones. That was an honest statement, and it was typical of the ideological integrity of the right hon. Lady. Nevertheless, it was positive evidence of the accuracy of the suspicions voiced by the hon. Member for Worcester (Mr. Peter Walker), in his opening speech, that this Government remains dedicated to the 19th century notion that public ownership is a sort of magician's wand and that, wherever there is a problem, all that one needs to do is wave this wand and, behold, instant Utopia.
It will not be news to the Government that the Liberal Party will oppose any measure of nationalisation which may be introduced in this Parliament or within the foreseeable future. I want, in that connection, to refer particularly to the nationalisation of bus companies and the


setting up of the public transport authorities which are proposed by the Minister.
No case for the public ownership of bus companies has been made by the Minister, by any of the documents published by her Ministry or by impartial observers and authorities. The system which is proposed of setting up public transport authorities is made much worse by the fact that they will have the right to select not only the bus companies that they may choose to take over, but the routes which they consider to be more profitable or more desirable for public ownership, leaving privately-owned bus companies literally with the most unprofitable routes under their control.

Mr. Eric Lubbock: Is it my hon. Friend's understanding that the Minister intends to nationalise organisations such as the Orpington Rural Transport Company, which is a highly responsible and public-spirited company operating four mini-buses, of which I have the h3nour to be president?

Mr. Bessell: My hon. Friend has made the point which I am trying to make perhaps more succinctly than I have succeeded in doing.
Under the Minister's proposals, there is doubt that a regional passenger transport authority would have the complete right to take over the operation to which he refers and would be able to make whatever use of it that it chose. The consequence is that an economically viable bus company could be put in a position where it would fail in its obligations to the community, and where it might fail completely and go into bankruptcy because it had been robbed by a hungry Government of its profitable routes and left with no more than the cash-loss routes which are nevertheless a social necessity. I believe that that is quite absurd, as well as being a disgraceful proposal.
In addition, as the hon. Member for Worcester said, the passenger transport authorities are to consist of areas which are to be designated by a Ministerial Order. Any local authority may discover that it is part of such an area, and it will have no voice and no say in the selection of the Minister.
Secondly, it is the ultimate intention to cover the whole of the country, although, as far as I have been able to discover,

London is excluded for some curious reason.
Thirdly, not only are the areas designated by the Minister, but the members of the boards will be selected arbitrarily by her, and it has already been pointed out by the hon. Member for Worcester that there will be no opportunity for an objection by a local authority and no possibility of a public inquiry. Surely that is dictatorship at its very worst, and something which—[Laughter.] The hon. Member for Dunbartonshire, East (Mr. Bence) laughs, but it is not a laughing matter when the rights of democratically elected local authorities are to be taken away from them in this arbitrary manner by the Government.

Mr. Cyril Bence: Has the hon. Gentleman ever opposed the existence of traffic commissioners, who license passenger buses and bus routes throughout the country and can revoke them?

Mr. Bessell: That is completely different. In a situation of this sort, where existing privately-owned companies are operating in a responsible manner, an arbitrary decision by one of the passenger transport authorities can result in their being taken over in toto or in part, robbing them of their profitable lines and leaving them only with their unprofitable lines, which is something which would not be contemplated by responsible traffic commissioners.
In addition, the Minister listed a frightening collection of proposals which she intends to put into effect and powers which she intends to give to these passenger transport authorities. Taxis, car hire firms, hovercraft services, repair shops and even refreshment depots at bus stations may be taken over and operated as nationalised undertakings. I believe that this is a grave infringement of liberty which I am confident that my right hon. and hon. Friends on this bench will oppose vigorously.
I do not propose to speak at length, but I must turn briefly to docks and harbours. On 14th April, at Bristol, the right hon. Lady is reported as saying that the port industry of the country could be expected to be taken over by the Government and nationalised within the life of the present Parliament. I would be


the first to admit that there is a serious lack of full efficiency at the ports. I would admit, too, that the long-standing difficulties between labour and management are far from being resolved, and that there are many very bad examples of the misuse of the worker force in the docks. I was astounded and horrified recently when, for the first time, I realised that the retiring age for a dock worker is still 68 and that his pension is only 25s. a week. Those are matters on which I should expect any radical Government to take action.
However, I do not believe that taking radical action means simply reverting to what I have already referred to as the 19th century policy of nationalisation. How much better it would be if we could have a new charter for all dock and port workers. How much better it would be if there was a proper allocation of Government funds for the modernisation of workers' facilities at the docks and the provision of many of the minimum requirements which are denied to them today. How much better it would be if the Government would utilise some of the money which will be involved in the purchase of docks for nationalisation for constructive purposes of this sort.
I should like to see an effective joint control of our docks and harbours by the unions, non-union workers, existing managements and local authorities, but I do not believe that the real solution to the existing problems lies in nationalisation, and I would hope that, in the latter half of the 20th century, the Government would be more forward-looking.
I recognise only too well the very real difficulties under which the right hon. Lady and her colleagues are operating. I say nothing about the cut-back in the road programme due to the economic difficulties of the Government. I realise that all her proposals are subject to Treasury approval, and I recognise, too, her honest desire to provide a programme for road construction, for better airports and for modernising the railways.
The right hon. Lady is a hardworking and conscientious Minister who has a heart as well as a head. This has been well displayed by her attitude to the rail passenger services, and the fact that

she has been prepared to consider them in terms of social need, and not merely in terms of economic viability, but, in view of her quite astounding statements this afternoon about Socialist nationalisation, I ask her to think again and to abandon these wasteful, needless nonproductive schemes of public ownership which might have had an application even in the years between the wars, but certainly have no application whatsoever under modern economic and industrial conditions in Britain.
I ask the right hon. Lady instead to use the money which will be wasted for this purpose, money so scarce and so precious, for positive progress under private and under municipal ownership.

6.31 p.m.

Mr. Kevin McNamara: I listened with interest to the speech of the hon. Member for Bodmin (Mr. Bessell), and particularly to what he said about worker participation in the industry. I know that this is of tremendous interest to the Liberal Party, but I remember that when the Companies Bill was discussed in Standing Committee, and this question was raised, the hon. Gentleman was present on only one occasion. I think that we must, therefore, treat his remarks with the suspicion which is developed when a person pays little attention to occasions when an important issue like this is raised.
I do not wish to enter into a discussion of the pros and cons of nationalisation. I think that the hon. Member for Portsmouth, Langstone (Mr. Ian Lloyd), who, unfortunately, is not here at the moment, gave all the arguments for it when he spoke of the need for rationalisation, of the need for integration, and of the need for efficiency. We on this side applaud these aims, but it is just these things which are missing from the port authorities at the moment, and it is for this reason that we on this side of the House, dogma or no dogma, deep-dyed Socialist that my right hon. Friend may or may not be, support the idea of nationalising the docks industry.
I turn now to deal with some of the points made by my right hon. Friend in the document which she put out saying what is and what is not to be contained within the ambit of the regional port authorities. One of the things which my


right hon. Friend left very much in doubt, and at their discretion, was the question of lighterage and towage under the new regional port authorities. It seems to me that lighterage is an important element which must be included in any system of public ownership, particularly if one thinks of the Thames and the Humber, on which so much cargo is carried by lighters. To ensure that ports are used efficiently it is essential that lorries, dock facilities, and everything connected with lighterage should be brought within the ambit of nationalisation.
The argument that this has something to do with the waterways does not add up to very much. If we want an integrated transport system, we must integrate all the lighter, barge, and canal traffic with the general traffic going through the ports.

Mr. Webster: Is the hon. Gentleman advocating the abolition of the free water clause in the case of the London Water Authority for lighterage or the complete nationalisation of them?

Mr. McNamara: I am advocating the complete nationalisation and integration of all people concerned with the transport of goods. Does that satisfy the hon. Gentleman?
I think that the peripheral agencies which exist within the port authorities, the forwarding agents, the specialised services and so on, should all be included within the ambit of nationalisation. There are many people who act in the classic way of entrepreneur. They do not own the goods, neither do they service them. They merely take them from one person and place them at the disposal of another. All that they do is pick up a telephone and find out which ship is going where, and what space is available on it.
Many of these services could well be put under the control of a nationalised authority. In Manchester, all these services are carried out by one agency. The system works efficiently, and the authority is able to use its position to offer rebates to exporters and users because it controls the situation. This is the sort of thing that I want to see operating in other ports.
What is to happen to the dock worker under this new system? One thing that is certain is that dockworkers wish all the

operations of the ports to be taken under public ownership. They are thinking of their work, of road transport, of the various assets and facilities at the docks, and particularly of their employers. One thing which became evident from a meeting of the unofficial port workers' committee in Hull is that there is a suspicion at the moment about the licensing system for port employers, the 80 per cent. and 20 per cent. dictum. This system is creating grave suspicion—I am not here to argue whether this is right or wrong. The point is that this has been a bone of contention for some time. People are wondering who are to be among the 20 per cent., who are to be among the favoured few. They are wondering whether those who have taken a militant attitude to trade unionism will be penalised.
These are some of the problems with which the authorities are faced while trying to work out a system of modernisation and decasualisation. I am certain that if, when my hon. Friend replies to the debate, he says that after these ports have been nationalised there will be only one employer, a great deal of the suspicion and controversy will be removed from the docks, to the benefit of the workers, the users and the economy of the country.
One of the things about which people are suspicious is what is to be the position of the large shipping lines and the large users of particular ports. Will they have part of the labour force assigned to them permanently? What will be their relationship to the assets which they use on the docks? Will these assets be under public ownership, and be leased to the big shipping lines, or the big stevedors, or will they be rented for a certain time?
What will be the position of the people who use the wharves, quays, and berths? What kind of restrictions will be placed on them? Will they have an overriding right to a particular berth or quay, or will they have to take their place along with other users of the port? If they are to be given a special position, will any limitation be placed on them? For example, will they have to show that they will use a particular quay or berth for at least 75 per cent. of the working year, or something like that?
If a system of leasing is adopted, there could be under-utilisation of port assets. This is something which we are seeking to avoid by nationalisation and by dealing with the whole problem of the use of our docks and harbours.
I turn quickly to the question of the nationalisation of public transport. I welcome this for a variety of reasons. I spent my early youth on Merseyside. In that area at one time we had five bus companies running the same routes and picking up the same passengers. We had a wastage in terms of organisation and the use of manpower, and there was a difference in the tickets and a difference in fares. Buses picked up passengers at one point but were not prepared to put them down at another. All of this led to total confusion among the bus companies, the users of the buses and, worst of all, it was a terrible waste of assets.
I am particularly concerned with a situation that arose in my constituency and with my union. At the start of this year there was a strike by members of the East Yorkshire Motor Services. The men working for this company were duplicating certain runs made by buses belonging to the Hull Municipal Corporation. The Corporation busmen were given a bonus; the East Yorkshire people were not given that bonus, although they were doing the same work, observing the same schedules, and carrying the same passengers. If there was to be efficiency for the sake of good working relationships and the establishment of a sensible and rational attitude to the problems of that part of Kingston upon Hull there was no sense in having two different bus companies running the same routes.
If we are to achieve what we hope to achieve we must have a rationalisation not only of the part played by the bus companies, but also of wage structures and proper working conditions for people in the bus transport industry. This is one industry in which there is much need for reorganisation, for a re-thinking about the system of payments, and for the provision of proper rewards for what is a very tiring and soul-destroying, and yet, at the same time, very responsible—and at times dangerous—occupation.
The hon. Member for Bodmin said that there was a terrible fear that if any part

of the private bus companies' services were taken over it would be those which were making money. This would be a reasonable argument if it were true, but it is the services which are losing money which private bus companies are so keen to lose. They do not want to provide the social services which are needed in the villages. It is precisely those services which the bus companies do not wish to use; they wish to use the profitable services, which they are duplicating with municipal authorities.

Mr. Heseltine: Is the hon. Member not aware that it is the profits from the city centre routes which subsidise the country routes?

Mr. McNamara: I would be prepared to accept that as a reasonable point if I were not aware of the keenness with which the private bus companies discard the unprofitable services and concentrate on the profitable ones.

Mr. Bessell: Does not the hon. Member realise that many local private bus companies are compelled to run unprofitable services by direction of the traffic commissioners? It is the removal of the profitable services which they reasonably fear.

Mr. McNamara: I appreciate that, but I return to my main point. The appeals made by private companies to withdraw services or increase fares are made in relation to those routes which are unprofitable. If a company wants to run a system based entirely on the profit motive and not on a basis of social service this sort of thing will happen continuously.
One of the major disappointments that I have had since I became a Member has concerned the part played by the British Transport Holding Company in companies in which it has a large shareholding. It has a holding of 48 per cent. in the East Yorkshire Motor Service and a holding of 44 per cent. in the Ribble Motor Service, yet these large shareholdings by this nationalised holding company have not been reflected in its attitude to the people working in the industry. I hope that when the various regional authorities are established in respect of bus companies a better attitude will be displayed to the important people


—those who play their part in this essential public service.
What will happen to the holding company when it loses its bus services? It will be left mainly with various interests in the shipping industry. As my right hon. Friend knows, for a long time I have been an advocate of the public sector's taking a greater share in the coastal and home trade shipping industry. This covers British Railways' ships, those belonging to the holding company and those belonging to various nationalised power boards. My right hon. Friend talked about the efficient handling of goods from the point of origin to the final destination. I come in a complete circle to what I said at the beginning of my speech, when I was talking about efficient handling of the ports. We also need efficient handling of the ships using the ports.
At the moment, the question of the control of ships, their destinations and heir cargoes, is completely in the hands of private shipowners. We have had the spectacle of the British shipping industry as a whole carrying a smaller share both of our imports and our exports. Overall, we have had a balance of payments deficit in British shipping in the last few years. With the ships that British Railways control—and their record of controlling is nothing to boast about—the ships that belong to the holding company, most of which are managed by private firms, and the ships controlled by various nationalised power boards, we have the nucleus of a very effective and powerful fleet which can be of tremendous importance in our trade with Europe and around our own coasts. We can carry goods efficiently by road or rail, in containers, into the docks and on to our own ships, where we can control the way they work, their destinations and their efficiency.
I want to say a word on the question of worker participation. In the docks, more than in any other industry, there is a history of bad industrial relations and suspicion. In the docks, people must be shown that they can have confidence in the people who manage the ports. At all levels people must know what the aim is and what the problems are. This is particularly true in the case of containerisation. There is a rundown in the labour force

at our ports and in the past few weeks various speculations have been made as to the extent of this rundown. It has been possible, because of good worker relations, to run down the labour force in British Railways and in the mines, and in my view the docks, under nationalisation, should be able to deal with a similar problem.
But there must be participation at every level. There must be communication upwards and downwards. There must be a shared responsibility and, above all, an understanding of what the future of the ports will be, the aims of management, in which the workers are participating, and the overall aim for the industry and the country. The debate has been welcome because it has enabled us to confirm our belief that the ownership of the means of production, distribution and exchange is essential to a socially just society.

6.50 p.m.

Mr. T. G. D. Galbraith: The knockabout turn of the Minister reminded me of the 1945 General Election, when one of the main controversies was over nationalisation, which her party presented as a magic cure for almost every evil. In spite of our warning, the picture of the fine things which would follow once private ownership and the wicked profit motive vanished so captivated people that the Socialists won the election. However, when they came to translate promises into performance, it became apparent that the mere change of ownership solved nothing. It did not mean higher productivity, the end of the need to earn a profit or even happier industrial relations. Deficits, strikes and poor output were the sorry record of nationalisation because of which the party opposite was rejected in 1951.
For 13 years, the Socialists languished in opposition, which explains why they are called the wasted years—because they apparently did not learn the error of their ways. The nationalisation of steel, which has just been completed, turns out to be not the last chapter of an old story, as we were led to believe, but the beginning of a new drive for State ownership of the most virulent kind, with ports, lorries and docks on the requisition, rather than the shopping, list. This comes when the railways, after a generation of nationalisation, are still


costing the taxpayer 6d. in every £ of income. In view of this failure of nationalisation, where it has been tried, to solve transport problems, why have more now?
According to one Lady's hand-outs on the ports:
Unified control of policy is essential to replace the present fragmentation of development.
Hearing this, one could be forgiven for thinking that the ports existed in an unbridled, free-for-all, laissez-faire world, but the truth is the reverse. The right hon. Lady has all the power that anyone could desire. Her control is already so powerful that she could hold up for months the building of a badly needed container berth in Scotland and eventually authorised its construction only in answer to a Question from me, on the very eve of the Pollok by-election—a deathbed repentance which, I am glad to say, did her party no good at all.
The objective of the control which the right hon. Lady wants is apparently a balance between the ports, but how does she know what is the right balance any more than Pilate knew what was truth? The arrogant assumption that she or someone at the centre knows all the answers means so much centralised control that local enterprise and development will never flourish. Centralisation of this kind is a recipe not for growth, but for stagnation.
The right hon. Lady displays the same attitude towards freight. She said in another of her hand-outs, for which we are grateful, as they show how she is thinking:
The first principle behind the N.F.O. is that it is ridiculous to have two publicly-owned transport organisations in competition with each other.
It is competition which she does not like, because that upsets her idea of the right balance. She goes on:
I can't believe that anyone will seriously defend this waste of money
which comes from competition.
This is the language of the police State and of dictatorship—[HON. MEMBERS: "Rubbish!"] Of course it is—and certainly not that of a democracy. Coming from a woman, it is all the more incred-

ible. Or did the right hon. Lady enjoy, during the war, having to put up with the utility clothes which the gentlemen in Whitehall provided for her, rather than being free to indulge her own fancy in fashion? Does she believe in freedom? Does she not understand [Laughter.]—Hon. Gentlemen may laugh, but this is a serious matter.
Does the right hon. Lady not understand that the alternatives of road and rail, although they may appear to her and her Socialist planners to be wasteful, provide the man in the street with that most valuable thing—freedom of choice? If this choice is a waste, does this mean that she thinks that it is ridiculous to have three publicly-owned fuel organisations in competition, and that we will soon be denied choice among coal, gas and electricity? That is certainly the logic of what she says and the country should be made aware of it. One hon. Member asked why we were having this debate: it is to alert the country in time.
Far from being a waste, choice is the customer's only defence against the abuse of monopoly power, of being forced to take it or lump it, which is clearly her intention for transport users. The right hon. Lady's handout Foes on to say:
The second principle behind the N.F.O. is that if we aren't to have an unnecessary waste of our resources the railways must carry as much as possible.
What she is saying is that, because they are there, the railways must be used. But this attitude spells stagnation and not development. It could have been just as easily used to justify retaining the stagecoach and the canals rather than developing the railways. Indeed, if her policy had been applied 130 years ago, there would have been no railways today to worry about.
Does the right hon. Lady not see that, by talking like this, she brands herself as a reactionary to development and change and that it is sometimes economically right to discard the old? Does she never discard a dress because it is out of fashion, although it is not worn out? Of course she does. Perhaps the Parliamentary Secretary will tell us what will be the extra cost of this centralised diversion through the N.F.O. of traffic from road to rail. Also, what will be the extent of diversion of traffic? Will


it be 1 per cent., 2 per cent., 3 per cent.? What effect, if any, will it have on congestion on the roads?
Congestion, not ownership, is the real transport problem. The right hon. Lady's proposals for passenger transport show the same irrelevant emphasis on ownership, the same blind faith in "integration", a word which seems to mesmerise her, but which, by itself, offers no solution. She is careful to make a gesture towards local control, but that is quickly shown to be meaningless, since she retains the rights to refuse membership of the Authority to anyone whom she considers unsuitable—presumably because he is a Tory, for example—even though put up by the local authority. She makes a worthy call for new development, but immediately undermines it by the assumption that there is a right balance between road and rail irrespective of passenger choice which she will manipulate by grants and subsidies to paper over the question of costs.
But costs are vital to any worthwhile decision on transport. In my opinion, there should not be any overall blanket of subsidies. People should pay for what they get and they should know what they are getting and what they are paying for. Then, according to their own priorities, they can allocate their resources in the way they think best instead of having it done for them by the Minister—because that is all that subsidies amount to; all they amount to is the Government saying, "We think that your transport should be cheaper, so we will make your housing dearer by putting part of the cost of transport on the rates".
Surely that is a childish way to behave. Most of us can well make our own decisions ourselves if only the Minister will give us the true facts. If some people are genuinely too poor to pay the full cost of their travel, let them be personally given help if necessary, but do not let us have a general subsidy for everyone which, by making the existing system artificially cheap, prevents new developments which might otherwise take place.
On 22nd February, when we were discussing transport policy in the House, the Minister uttered a cri de coeur, which she repeated this afternoon. She said, "Public transport cannot be left to

struggle on unaided". And so the right hon. Lady has made these proposals for P.T.A.s to help, as if they were something radically new. There is nothing new about it. There is no need to argue about their merits, or whether they will work or not. "Why look in the crystal ball?" as the late Mr. Bevan said. Why indeed, when all the right hon. Lady has to do is to step outside her Socialist ivory tower into the world of reality and to take a look at London—because in London transport is nationalised.
There, the conditions for integration and all the other things which the right hon. Lady wants already exist to the nth degree. Yet in London the tubes are still unbuilt, the buses still run in convoy because nobody knows where they are and it is only the private taxis which have wireless to signal what their position is.
In fact, after a generation, public ownership of transport in London has achieved precisely nothing because ownership is irrelevant to the problem of transport. Whoever owns it will make it work if only the Minister creates the right conditions—and by creating "the right conditions" I mean, first of all, the roads. The right hon. Lady was wildly wrong when she said that the Conservative Government had no road programme. Of course we had a road programme, and it is one which we never cut, and which she has cut.
What it means is getting the roads right, the traffic engineering, the parking places related to the capacity of the roads and, above all, co-ordination. I am sure that the right hon. Lady will like that word, but the co-ordination that is required is not the co-ordination of the transport operator. That is not what is lacking. It is co-ordination in the Government and local authority machines, particularly with regard to land use, that needs looking into, and that is the proper sphere for Ministerial activity.
The right hon. Lady should get that framework right, find out the real costs of road and rail and enable people to have the facts so that they may choose sensibly. She would then be doing something worth while and much more valuable than coming down from Mount Sinai, as she seems to think she has done, with a false set of commandments.
I know that the Minister is a dedicated Socialist. I know that she believes in centralisation. I know that she has great faith in the power of the State—though why she should have such faith I cannot imagine, because it will be the same sort of people who are running it. But, equally, I think that she wants to get practical results. If she does, I urge her, before she goes any further, to explain to us why the principle of public ownership which has not worked in London should work any better in any of the four conurbations which she mentioned.
At the same time, the right hon. Lady might explain why Scotland is not included. I am delighted that it is not included and delighted that there is no Scottish Minister. If it means that Scotland will not be included, no one could be more pleased than the Scots. But we should like to know why.

Mr. Bence: There will be a row if Scotland is not included.

Mr. Galbraith: When there is so much that requires to be done, I ask her not to waste her own time and that of her officials, and the time and energy of countless transport workers throughout the country, to say nothing about the time of the House, in organising a change of ownership which will achieve precisely nothing except to create a vast bureaucratic machine, a great empire, perhaps, for the Minister, but a poor transport service for the people of the country. For transport is a living thing. The solution cannot be stamped out once and for all as a pastrycook makes a cake. It requires the gardener's patience to train and direct it, with constant attention to changing conditions. It is an endless adventure.
I urge the Minister—I notice that she is looking at her speech; I hope that she is listening to me—to leave her doctrines behind her, to go out and look at what is happening in London and to seek the practical and gradually evolving solutions which alone will make transport work satisfactorily and efficiently.

7.7 p.m.

Mr. Cyril Bence: I was astonished by the speech which followed the remark by the hon.

Member for Glasgow, Hillhead (Mr. Galbraith) that my right hon. Friend's speech had been a knock-about. The speech by the right hon. Member for Hillhead was slapstick. I have never heard anything like it in my life. He objects to a flat subsidy right over the field, and yet he was a junior Minister, under a Secretary of State with two other junior Ministers, at a time when my right hon. Friend the Member for Kilmarnock (Mr. Ross) described the three of them on the Government Front Bench as the Trinity of Faith, Hope and Charity. Now we know that he admits that up to now there has been no solution of the transport problem. That is what he says.
I know that Scots are vigorous, but his was an extraordinary performance. He "flew off the handle" because for the first time my right hon. Friend has made a conscious effort to see how, with the maximum freedom of operation, we can integrate and co-ordinate our transport services. Indeed, that must be done. We cannot go on in the twilight world of licensing and so-called private enterprise. How many private enterprise passenger services are there in this country? Most are owned by British Railways. Every one is conditioned by the traffic commissioners, who decide routes, licensing and stopping places.
For hon. Members opposite to talk about free enterprise in transport either of goods or of passengers is a piece of nonsense. Over the last 16 to 20 years we have heard Transport Minister after Minister asked to do something to convince the traffic commissioners of the need for a bus service from one village to another. The whole transport service has been conditioned by the system set up by right hon. and hon. Gentlemen opposite when in power and yet, for some extraordinary reason, as soon as they are in opposition they say that the system is wrong. Because my right hon. Friend is doing something about it, they criticise her.
I heard from my right hon. Friend today one of the best speeches that I have heard from a Minister of Transport during my 17 years in the House. My faith was restored. It is about time that somebody said that we cannot run in this overcrowded island a system of transport for people on road or rail if the principal motivation in doing it is to see how much


money can be made out of it. That is why we have licensing systems. The whole country is governed by regulations—with traffic lights, policemen on point duty, and so on—to save people on the roads.
I trust that the hon. Member for Hillhead—I am tempted to call him my hon. Friend, because he is a friend of mine—accepts that he was making a knock-about speech. It was fun to listen to him, though some of his remarks were astonishing. If we are to have an efficient transport system, we cannot afford some of the duplication that used to go on. In the Clyde Estuary area, from Glasgow to Dumbarton, we used to have four means of transport; two main roads and two railway lines. One bus route, on the upper road, was eventually removed, and the lower bus route was kept on.
It was nonsense, for this 15-mile journey, to have four means of transport. My hon. Friend the Member for Central Ayrshire (Mr. Manuel) will support what I am saying, because he used to drive the old Caledonian trains on this route. His train probably carried six passengers while the one going in the opposite direction carried four.

Mr. Archie Manuel: I am delighted that my hon. Friend should refer to my past activities. To be factual, when the Caledonian Railway was running there were also the Glasgow, South Western and Great Highland Railway. When the L.M.S. came in, it embodied the old Caledonian Railway.

Mr. Bence: I am obliged to my hon. Friend and I am comforted by the comments of the hon. Member for Hillhead to the effect that it does not matter who owns such an enterprise. The Welsh are quickly converted to a good idea. It does not matter who owns a service as long as an efficient means of transport is being provided for the public. But whoever owns it must not constantly be looking over his shoulder at his bank manager because the service is unprofitable and his overdraft is rising.
A really efficient transport industry cannot be in the hands of private enterprise. Our old friend Jack Maclay introduced the Highlands and Islands Shipping Bill to enable the State to run Highland shipping because the private shipping

organisation "went bust." MacBrayne's could not make shipping and transport pay in the Western Isles. The Tories did not nationalise that company, but, instead, guaranteed the shareholders 6 per cent. The State ran it and took responsibility for it—but assured the shareholders 6 per cent., win or lose.
The present Minister of Transport is not as daft as that. She comes from Lancashire, where folk know their business. So do the Scots—that is, all except the hon. Member for Hillhead. He is prepared to run the whole show and allow everybody to make profits on the profitable routes but allow the State to cover the losses of the unprofitable ones. Like the coal mines, the railways and everything else, hon. Gentlemen opposite want the State to step in when losses are made.

Mr. Galbraith: I was careful to say that I did not believe in subsidies. The hon. Gentleman is implying that I am in favour of them and that a subsidy should be paid on non-profitable routes. I do not believe in that.

Mr. Bence: The hon. Gentleman sat on this side of the House for 13 years. He was a Transport Minister and was at one time a junior Minister at the Scottish Office. He was one of the Holy Trinity of Faith, Hope and Charity.

Mr. Manuel: He was Hope.

Mr. Bence: For 13 years he waltzed through the Lobby in support of Conservative plans to give subsidies to farmers, shipbuilders, the railways, MacBrayne's and dozens of others. Grants galore were given for capital investment and all sorts of other things.
Since then I have heard the hon. Gentleman rightly advocate a system of incentives. In a closely-knit island like Britain, with the whole system of processing being so overcrowded, this is the only way to increase productivity. However, the hon. Gentleman is still fond of placing Questions on the Order Paper calling for bigger grants and greater allowances of public money to assist private investors in various types of industries.

Mr. Galbraith: Mr. Galbraith indicated dissent.

Mr. Bence: The hon. Gentleman now appreciates that giving subsidies galore is not the answer. His conversion to the


Labour Party's view is even greater than the conversions achieved at the height of the Evangelical Movement in Wales, in my youth.

Mr. Peter Mills: Would not the hon. Gentleman agree that the conversion of the Prime Minister to the Common Market concept has been as big as that achieved on the road to Damascus?

Mr. Speaker: Order. We are discussing transport.

Mr. Bence: The Common Market has nothing to do with this debate, but I would be glad to discuss the matter with the hon. Gentleman on another occasion.
The hon. Member for Hillhead talked about freedom of choice, said that there was freedom to choose electricity if people wanted it and went on to say that he was against flat rate subsidies. I was astonished to hear him say that because many of my hon. Friends were in the House when the hon. Gentleman's father was a Minister at the Scottish Office. His father was popular with hon. Members on both sides; and for a Scottish Office Minister to be popular at all in this House takes a bit of doing.
The hon. Gentleman's father is Chairman of the Hydro Electricity Board—

Mr. Galbraith: He was. He has retired.

Mr. Bence: I accept that he is no longer in this post, but he was for a number of years. Is the hon. Member for Hillhead aware that the Board gets a flat-rate subsidy from the more prosperous regions so that the people living in the Highlands and inaccessible parts of Scotland may have electricity at the same price?
Hon. Gentlemen opposite frequently say that private transport operators must be able to operate the more profitable routes if they are to provide services on the less profitable and unprofitable routes. This is only right. The traffic commissioners say that if a private operator wishes to run a service from A to B, he must be prepared to run a service from X to Y, X to Y being an unprofitable route. Indeed, if an operator wants to run a service, which he knows will be profitable, to the exclusion

of all other services, he will not receive a licence from the commissioners. The hon. Member for Hillhead is now objecting to this system.

Mr. Galbraith: Mr. Galbraith indicated dissent.

Mr. Bence: He is out of step with everybody else. He is like "Our Bill". Although most of his speech was sheer nonsense, I will not continue to have fun at his expense, because many hon. Members want to speak in the debate.
Problems arise in our big cities as a result of the way in which municipal bus services are operated. Municipal bus services in Glasgow run to various points on the perimeter of the city. Where I live—and since I am nearing pensionable age, in a decade or so I will be spending much more time there—on the boundary of Clydebank and Glasgow one can take a 2d. fare on the municipal bus. A person living just over the boundary line wishing to catch the bus to Glasgow must pay 1s.
This is a serious problem and the Government at present can do nothing about it. If we get a regional passenger organisation, whether it be private enterprise or not, I hope that something can be done to enable people living in such contiguous areas to get the same concessionary fares. In due course, between certain hours my wife will be able to travel to Glasgow for 2d. while a person just across the road will have to pay Is. on the same bus because he lives outside the Glasgow boundary. That anomaly should go.
Everyone who has been in industry knows that the cost of transport lies in the handling. It is not in moving the product on railway lines or on the road, but in taking it off the production line, putting it on a vehicle and then, at the other end taking it off that vehicle and putting it on to another. When we are considering integrating transport to make it more efficient, the manufacturer must be brought into the picture. Standardised container units, standardised palletisation, and mechanical loading devices can be introduced over a wide area of industry, and I hope that a serious effort will now be made to go right into transport systems and transportation costs. I hope that in doing that, my right hon. Friend will pay special attention to the possibilities of expanding the use of


mechanical handling to overcome the difficulties of loading and unloading on road and rail.
I compliment my right hon. Friend on believing, as I do, that to try to provide transport in a congested island with a population of 54 million on the basis only of profitable investment will fail completely, and lead to chaos. The only alternative is to put the transportation of goods and people on a Socialist basis that is motivated by the needs of the people—

Sir Cyril Osborne: Who pays for it?

Mr. Bence: We pay for it. The taxpayers pay for it. Who else does the hon. Gentleman think pays for it?

Sir C. Osborne: The hon. Member said a little while ago that those in private enterprise could not provide the transport necessary because of having to look over their shoulders all the time at the bank manager. That is exactly what the Chancellor of the Exchequer is doing all the time on behalf of the whole nation—looking over his shoulder to the international bankers to see whether they will support us with the finance to run the country.
I hope that when the hon. Gentleman makes his complaint he will realise that when the private haulier cannot run his private transport and other services without looking over his shoulder to his bank manager, he is doing just what the Chancellor of the Exchequer is compelled to do. Therefore—

Mr. Speaker: Order. Interventions must be brief—especially in the midst of a peroration.

Mr. Bence: It is true that in international banking and finance we have the merchant bankers and merchants always looking over their shoulders to the international bankers but, when we have a socialistically motivated enterprise to serve the people as a whole, my right hon. Friend will be looking over her shoulder at hon. Members to see that we get good service for our constituents. I would rather have my right hon. Friend looking over my shoulder—

Sir C. Osborne: Who is to pay?

Mr. Bence: We—the community, the taxpayers. Who, in the name of fortune, pays for everything in the country? It is the consumer, and no one else. Who pays the farmer and the manufacturer of motor cars? We do—the people who use them. The consumer pays for everything he consumes, either through taxation or through his income. Is it thought that there is a supernatural force that pays for these things? The consumer pays for everything, one way or the other. The hon. Gentleman knows that very well, and he is just trying to exploit the situation by talking about international trade and banking. My right hon. Friend is charged with organising our transport system, and I certainly believe that she has started far better than has any Minister in the last 20 years.

7.25 p.m.

Mr. Michael Heseltine: I am very grateful for the chance to speak while the right hon. Lady the Minister is still here. I shall not detain her for more than a few moments. During her speech she felt unable to let me intervene, and I quite understand it, as she had much to say. I want to draw one point to her attention. She said that she was disappointed because a lot of private enterprise industrialists were hanging back from the freightliner scheme.
Quite independently of any debate today I was slightly worried, because I spent the morning with the General Manager of the Western Region being told that one of my large industrialist constitutents would have to wait four or five months for an estimate for the freightliner service as the Western Region was inundated with requests for such estimates.
I hope that later in the debate the Joint Parliamentary Secretary will explain who is right. Are the private industrialists hanging back, with the railway authorities short of inquiries for freightliners as a result, or is the General Manager of the Western Region right when he says that there will be a four-or five-month delay before my constitutent can be told whether he can have an estimate and how much that estimate will be? I thank the right hon. Lady for so kindly staying to hear me, and if she now wishes to leave the Chamber I shall quite understand.
Anyone taking an interest for the first time in the whole problem of urban transport is bound to find that today there is a coinage of words that have general acceptability among people who are in any way involved in transport. Those words have now become so well established that they are almost platitudes. We have such phrases as "no single solution", "the co-ordination of policies", "planning and future development There is no one on either side of the House or throughout transportation who does not use those terms, either in making a decision or in providing the justification he needs for that decision. In that respect, there is a great harmony among those in the industry.
There has never been a more accurate assessment of the general problem of urban transport than that contained in the White Paper published a year ago by the Minister, who summed up the position in paragraph 58:
In the long-term the right solution seems likely to be found in the establishment in these areas of single authorities with responsibilities covering land use. highways, traffic and public transport. Clearly, however, a fundamental change of this kind must await the consideration and findings of the Royal Commissions on Local Government.
That is a general statement of the problem, and everyone could give credence to it and accept it.
We on this side certainly would do so, but there was a slight hesitancy in our minds, because when we moved to paragraph 59 we found that it stated that, despite what paragraph 58 had said about having to await the findings of the Royal Commissions, and that until then such matters as building, the provision of parking, management, and land utilisation, could be set aside, in terms of public transport they could go ahead at once. My hon. Friends were right in wondering why this particular aspect of the problem should be selected and dealt with in advance of the Reports of the Royal Commissions. I am sure that the Parliamentary Secretary will sympathise with us in at least asking why paragraph 59 should be acceptable, when paragraph 58 argued in favour of a continuing delay.
My hon. Friend the Member for Worcester (Mr. Peter Walker) has made clear, and the Parliamentary Secretary will no

doubt repeat, that co-ordination is, to use the sort of vernacular of this part of the century, "the O.K. thing to do", and that it is an essential part of urban transportation. Indeed, it already exists. This is precisely what the traffic commissioners are doing, precisely what the joint organisations of rail and road are doing, and precisely what the local authority coordination committees are doing. They are doing it because there is no dispute about whether or not there is need for co-ordination. We all know that it is necessary and that it is being done. It is merely an administrative detail of whether we extend the power of these co-ordinating bodies or set up such bodies of one kind or another.
Our difficulty is that when the White Paper was published a year ago the outline of the conurbation transport authorities' proposal was extremely vague. It was so vague that it was possible for hon. Members on this side of the House to say that it might contain the germ of a good idea. We did not have the opportunity of debating it for seven months, and after that debate we were no wiser. There were seven months in which we expected details, but we were given no details and even after the debate we had none. I should have thought that the Minister would have some idea about what was in mind and could have given an inkling about what was at the end of this deliberation of which we heard so much.
During that debate the Minister gave an indication of the sort of things which the conurbation transport authorities might do. She did so by drawing attention to the memorandum distributed in December to the four conurbation transport areas which she visited at the end of last year, or the beginning of this year. The memorandum was put to the local authorities as a basis of discussion. Reading the memorandum, as I am sure many hon. Members have done prior to this debate, one realised that, like the original White Paper, it was extraordinarily vague. It was not only extraordinarily vague about intention, but it suggested that it was possible to do more or less anything. It looked over the whole horizon and said that the options were completely open.
I shall quote from the memorandum to show what the options were at the


beginning of this year. Dealing with the relationship of the conurbation transport authorities to the bus operators, it showed that three possible formulae could be applied. The first was that
there should be total ownership. The conurbation transport authority to take over, manage and operate the bus units within the area covered by the authority.
Then we move to the other extreme end which says that after carrying out the necessary reorganisation the C.T.A.s should have planning and supervisory functions rather than an operating rôle. Then we move to the middle of the spectrum which says that the authority should simply
own and operate the major bus services
which the municipal authorities are doing
but leave the private sector to go on competing.
It did not matter on which side of the House an hon. Member was, nor what sort of local authority existed, there was something in the proposal for everyone. That was the relationship about which the local authorities were first told. Any sort of detail was left to the Ministry.
Then the local authorities would be interested in the constitution of the C.T.A.s should they be set up. Any local authority could ask "If you are to deal with us and set up a central organisation, how will it be constituted? Where is the power to lie?" The Minister, in the way with which we have become familiar, adopted the attitude which is known as keeping the options open and had a whole range of alternatives for this aspect.
The memorandum said:
The central question would appear to be the question of local authority control and finance. At one extreme it would be possible to establish a wholly professional board with no formal links with the local authority, while at the other extreme the authority could he established as a joint board of local authorities.
The local authorities could read the memorandum and come to the view that whatever was happening at the moment it would only be a short journey away from what was in the mind of the Minister. That was the background with which we came to this debate.
Listening to some of my hon. Friends speaking about the ports, I envied them the luxury with which they enjoyed in having the McKinsey Report, a detailed

survey, an authoritative work and a factual investigation into the whole of the ramifications of the British ports. It was obvious that those who were talking about this aspect had a blueprint with all the facts and figures, and could deal with it, not on a doctrinaire basis, but on the basis of what good management dictated.
They were very luck. Our dilemma in talking about passenger transport authorities is that we have no such blueprint. All we have is a memorandum which has been leaked, although it is a confidential documents, to certain hon. Members. It is true that some of those hon. Members are on this side of the House, but why was the document not made available in the same way as the first memorandum was made available? Why were we not given the opportunity to find out what was going on?
In dealing with the proposed nationalisation of bus services, does the Parliamentary Secretary believe that the bus in itself is some sort of divine animal that should be protected from public question? Or does he accept that buses are merely an instrument to greater efficiency? If he believes that, he will also believe that facts and figures are important. If he is to envisage the development of a dramatic expansion of public ownership, it is reasonable—unless he seeks to protect the bus merely because it is a bus—that those people for whom the services are designed should have access to the discussions going on about their future.
This is the nub of our quarrel. We are not in the luxurious position enjoyed by some of my hon. Friends who discussed the question of the ports, of knowing what is in the mind of the Government. Even more deplorable, the Minister has told us that the little information that has been leaked is already out of date. What is the current situation in regard to the proposed passenger transport authorities? When will it be put before the House? Is it to be put before the House before the Bill is published? If not, are members of the public to have an opportunity to examine the proposal before it arrives as a blueprint, detailed and spelled out, for the Whips to steamroller through the House? Are any of those who are to have the opportunity to use these services also to have an opportunity to question and examine the detailed proposals?

Mr. Bessell: It appears from the proposals, mysterious as they are, that not only will the public have no say about the powers of the passenger transport authorities, but they may be required, through the local authorities, to pay for nationalisation. Does the hon. Member agree that that is the case?

Mr. Heseltine: It is exactly that. It is also more serious; they will pay for the nationalisation of the bus services and also to keep railways alive so that they will have the responsibility, which the Government are not prepared to take, for closing railway lines.

Mr. Ridley: Is it not even more serious? Now that 90 per cent. of councils are Conservative-controlled, does not my hon. Friend fear that there could be an effort to discredit Conservative-controlled councils by putting this immense burden on the rates, which seems to be the Government's intention?

Mr. Heseltine: My hon. Friend has pointed sharply at one of the grave disadvantages. However, what is sauce for the goose will one day be sauce for the gander. I ask hon. Members opposite to ask themselves whether the immense difficulties with which the Minister will confront my party will not be difficulties which they will regret having foisted on us when they find themselves in opposition.
Not only do we on this side suspect that there will not be public revelation of these details until the Bill is finally signed and sealed and all but delivered. We also understand that, once the designation has been decided upon by the Minister, there is to be no formal public inquiry in the area concerned and that there will be no means of protesting. Will the Parliamentary Secretary explain to the House why this is so? What is in the Minister's mind when she decides that the public shall have no right of access to decisions of this sort?
What has gone wrong with hon. Members opposite that they care so little for the fundamental rights of the individual? Why do they think they were sent here in the first place? Were they sent to act as lackeys for the Government Front Bench? Have they lost the right to ask questions? If this sort of thing had happened when the Conservative Party was

in power, hon. Members opposite would have marched from here to their constituencies in protest. So little do they value the basic freedoms when they are evaporated by their own party that they do not have the guts to stand up and fight for the things they once believed to be so dear. I ask the Parliamentary Secretary to tell the House why it is not to be told that it can examine the details and why the public, for which the services are presumably designed, is not to have the power and opportunity to examine them before they are imposed.
The proposals themselves have three—[Interruption.] Would the hon. Gentleman care to repeat that remark?

Mr. Bence: The storm is over.

Mr. Heseltine: I apologise to the hon. Gentleman, because I thought that he said something else. He can rest content. The storm is not over. It has only just begun. There will be 12 to 18 months of storm before we have finished with these discussions.

Mr. Bence: The sonic boom.

Mr. Heseltine: At least we knew when it was coming and when to expect it. No one knew when to expect these proposals.

Mr. Speaker: Order, Only one debater at once.

Mr. Heseltine: Thank you for calling me to order, Mr. Speaker.
These proposals for the P.T.A.s appear to me to have three specific characteristics. First, without any shadow of doubt, as one of the Parliamentary Secretary's hon. Friends admitted on television last night, these are out-and-out nationalisation proposals for the bus industry. They are a vast extension of nationalisation on a scale never envisaged.
I cannot blame the right hon. Lady, because it was well known that this is what she believed in. We all knew that she was an out-and-out Socialist. She is entitled to these views. She is entitled to put these things through the House of Commons. There is no complaint on our part as to that, but let us at least use the right words. Let us understand what she is doing. Let us not beat about the bush. This is nationalisation pure and simple, on a great and extended scale. Let us talk about it in these terms.


The first characteristic of these proposals is that they are nationalisation proposals.
The second characteristic is that, in one material respect, they differ substantially and materially from the original proposals contained in the memorandum distributed to local authorities. Although in many ways there were great options for the local authority from which one could take whatever line of action one wanted, in another respect these proposals differ, in that there is one aspect which was never spelled out in that memorandum and over which the local authorities would be entitled to think that they have been deceived—I would hesitate to say deliberately deceived, but deceived for all that. I refer to the question of the control which is supposed to go into the hands of local authorities.
The third characteristic of these proposals is, to me, the saddest. On the matter of the McKinsey Report, anybody who has played any part in managing any organisation of any type—many hon. Members on both sides have done so—knows the need to substantiate a case, not with rhetoric, not with fine phrases, not even with emotion, but, if it is a management problem, simply with facts and figures. That is all. That is the only basis upon which management decisions and the allocation of scarce economic resources can be judged.
I have read through these documents with great care. That does not take very long, because there is nothing much to absorb. There is not one single fact from one end to the other. There are numerous assurances. There are numerous statements of the type, "We will produce more efficient buses. We will produce better and more co-ordinated organisations". But there is not one fact.
We sympathise with the Minister's prejudices. We understand them. They are her prerogative. I do not believe that we should accept that, simply because she has these prejudices, there is some way in which she should be allowed to impose them on the House as though they are divinely inspired. I think that they are not divinely inspired. If the Minister has these prejudices, she owes it to the House to explain them, not with rhetoric, but in facts and in figures. In

short, all we ask her to do is to prove her case.
I want to say a few words about each of the three characteristics. There is, first, the power to take over buses and the question of compensation. There seem to be several aspects of the question of compensation. There are, first, the companies which are to be taken over as entities within the P.T.A.s. These, apparently, are to have compensation, but there is no reference to the sort of compensation they will have. They do not know. Perhaps the Parliamentary Secretary will tell us what the basis of compensation is to be.
We do not want airy words like "fair", "decent", or "reasonable". We want to know facts and figures. What is the Minister to pay for net assets? What is she to pay for earnings? What is she to pay for goodwill? How is the calculation to be made? How many years purchase are to be taken? This is the sort of information shareholders in these companies are entitled to have and which any responsible member of the public will want to have before the Bill is presented to the House, because it might be a cardinal aspect of the Bill.
On the second aspect of compensation, the hon. Member for Dunbartonshire, East (Mr. Bence) seemed to think that there was nothing particularly immoral in the guts being taken out of a company by its being deprived of its prize routes from the centre. The hon. Gentleman did not seem to think that it should prejudice a company to have all its prize routes removed and to be left to run the services on the periphery. The document contains an appropriate phrase, in that it refers in this case to "appropriate compensation". What does that mean?

Mr. Bence: What it says—appropriate.

Mr. Heseltine: I am glad that the hon. Gentleman has followed me thus far. I appreciate that "appropriate" means "appropriate". We have reached a certain unanimity across the benches. This is always reassuring. If the hon. Gentleman could for a moment imagine that he was a shareholder or a manager or the owner of one of the bus companies which is to have its best routes taken from it, and if he could further imagine that it was explained to him that he would get


"appropriate compensation", he would appreciate that the word would not have quite the magic for him then that it appears to have for him at this moment.
In virtually every business there is a whole range of products. Certain products are more attractive and cross-fertilise others. This does not mean that the other products are not profitable or that they should be discontinued. However, there are centres of profit which are particularly attractive and which stabilise a business and give it the room to breathe and to expand.
If one were to take out of any business of the sort that I am describing these major profit centres, although one might pay a certain number of years' purchase for these particular groups, one would do far more than that. One would put a cancer into the centre of those organisations. I am not making a party point. This is simply a management problem and, therefore, when we talk about appropriate compensation we want to know exactly what it means. This is indeed one of the most sinister aspects of the situation.

Mr. Bence: I do not want to misunderstand the hon. Gentleman, but is he suggesting that to enable private enterprise to sustain unprofitable country routes they should be given the right to run passenger services through major cities like London, Manchester and Glasgow, in competition with established services?

Mr. Heseltine: I am not suggesting anything of the sort. The traffic commissioners, after all, see that certain unprofitable routes are maintained by cross-fertilising them with profitable routes. But that is irrelevant to the argument. It is relevant to the argument only in this way, that if that sort of thing is going on now and the traffic commissioners can use that power now, why cannot they continue to do it without this elaborate P.T.A. legislation?
The next characteristic is the material way in which the memorandum that was published at the beginning of this year differs from the memorandum which has now been so ostentatiously leaked up and down the land. This is a very regrettable lapse on the Minister's part. As I understand it, the P.T.A.s will con-

sist of a board which has two-thirds local authority nominees, depending on the rateable value of the authorities involved, and one-third Ministerial nominees. In the original consultations and in the debate that we had in this House it was made clear to the local authorities that they were going to have control of the C.T.A.s, as they were then, and now the P.T.A.s.
I should like to quote from the OFFICIAL REPORT. This is what the Minister of Transport said:
It is because I believe that this integration"—
referring to the P.T.A.s—
must be geared to local needs that I prefer to give the job to transportation authorities, controlled by local people, rather than to nationalised area boards;"—[OFFICIAL REPORT, 22nd February, 1967; Vol. 741, c. 1737.]
It cannot be spelled out more clearly than that—"controlled by local people".
What happens? They get one-third Ministerial nominees, a chairman who is to be appointed by the Minister, two-thirds local authority nominees every one of whom can be objected to by the Minister and replaced by the Minister if she does not agree with the nominees put forward by the local authorities. Does that statement bear any relationship at all to what the Minister said in February of this year? Perhaps the Parliamentary Secretary can explain how he ties up the two sets of circumstances.
I ask hon. Members opposite to bear this point in mind, because we are in the difficult situation of being an Opposition today. Hon. Members opposite enjoy a substantial majority. But the time will come when there are substantial Labour majorities in these conurbation transport authorities, in the way that there are substantial Conservative majorities at present. Will they take kindly to the sort of difficulties in which our party finds itself, where 70 per cent. of the local authority representatives can find themselves outvoted by 30 per cent.? Is that the sort of situation which their faith in democracy encourages them to believe in? I do not believe they would have let us get away with it during the 13 years when we were in power. There would have been a great baying of the hounds,


and I believe that I would have bayed with them.
Times will change, and hon. Members opposite will be lumbered with the situation in which local authorities which they control will not have power because the system was rigged, not by the Front Bench of this side of the House but by the Front Bench opposite.

Mr. James Dempsey: We had this experience on the hospital boards. The Tory Government dropped the Labour members and replaced them with Tory nominees.

Mr. Heseltine: I should like chapter and verse of that. In any case, we are discussing transport, although I grant that there may be a case that the hon. Member can put forward. However, I know of no case where my party told somebody that they would give him control and then within six months rigged the system so that he did not have control. If the hon. Member knows of a case I would be glad to look at it, but I do not believe he does. I do not believe that the argument he put forward is on the same lines.

Mr. Dempsey: It is exactly the same.

Mr. Heseltine: My next point concerns the lack of facts. This is the most sinister part of the whole business. We are suspicious of a case which is pleaded without any facts to support it. I should like to quote the right hon. Lady's memorandum so that she can have some indication of what I have in mind. In paragraph 4(b) of the December memorandum, we read:
The day-to-day operation of separate undertakings is not sufficiently co-ordinated to meet the changing needs of the travelling public. The large number of small bus undertakings in some areas creates a need for an excessive amount of joint operation and prevents the economies of scale which in some cases might be achieved from somewhat larger fleets.
Those are fine generalisations. Could we have some supporting statistical evidence to justify that statement?
I put down a Question to the Minister asking what economies would be obtained from buying buses on a larger scale. One might assume that this would be one of the organisational advantages that she would expect to get. I got an airy-fairy Answer. No economy would be obtained.

Reading through the memorandum which has recently appeared, one finds it all spelled out clearly. The Government have no idea what sort of fare structure will apply in the future. They do not know what the cost structure will be. Yet these are the only tests that matter. This is simply a question of running a transport system efficiently, and we want to be convinced that we shall get efficiency.
My final point is one in which I hope hon. Members opposite will be interested. They will be aware that the P.T.A.s are to have the right to take over the suburban railway lines. As soon as the Government grant begins to tail off, as they will very rapidly, there will be a precept on the rates. Hon. Members might ask, "Who will this hurt?" Will it hurt the elderly and those on low incomes. I know that it is possible to give discriminatory help to old people. But what cannot be done is to give discriminatory help to people living on very low incomes with large families. These people living in the peripheral areas of large towns will find their rates going up, in order to pay for the suburban systems which today are paid for by the taxpayer.
The second effect will be that the local passenger transport authority will look at the bus services running alongside the railway line and they will say, "We do not need two systems. We will close the bus services." Then there will be no choice for the public, and the railway fares will be increased which will further hurt the people living on the edge of these areas. The effect will be to drive more people into motor cars, which will increase the congestion in the city centres as a direct result of this policy advocated by the Government.
Hon. Members must bear carefully in mind which sections of the community will suffer most by this decision to transfer from the national Exchequer on to the local ratepayers and, therefore, on to the backs of every citizen in the area, the cost of keeping open those railway lines.
It is a sad tale, sad because it is irrelevant to the main discussion which we should have been having about urban transportation. Hon. Members opposite have asked why we do not tell them how to run transportation in our towns. It is very flattering that, after so short a time


in office, they should seek our advice. In fact, they do not really want our advice. They are merely irritated because we are doing what they did so effectively during the 13 years of Conservative Government. We are in opposition now, and we are entitled to question the people whose job it is, who are responsible for administering our urban transport systems. It it not our responsibility.
These are the Government's schemes, and we must examine them closely. It is not our responsibility to do other than that, though I remind hon. Members opposite that, under the Conservative Government, the Buchanan Report was published, the most discussed but least acted on report in history. More than that, only recently, they have had the Report on Cars in Cities and another Report on the Better Use of Town Roads. There has been all the study necessary. All they need to do now is their homework. Let them read what the authorities say, instead of being mesmerised by what a Left-wing member of the Cabinet says.
We are faced with an abundance of inspired imprecision. That is all that the Minister's plans can be called. We are not permitted to discuss them in detail. We are given no basic information. There is to be no public investigation or check. The political merry-go-round which started in 1947 has taken 20 years to go full circle.

8.2 p.m.

Mr. John Ellis: I shall revert to the paper on the reorganisation of the ports. When I first read it, I thought that it was a good document, and the reception given to it by hon. Members opposite tonight confirms me in that view. The hon. Gentleman the Member for Glasgow, Hillhead (Mr. Galbraith) was so carried away by his opposition to the various pronouncements which had been made as to be rather unfair in castigating my right hon. Friend for not giving Glasgow a container port and then, when it was given to him, saying that it was no good and was further cause to damn my right hon. Friend even more.
As a Bristol Member, I hope that my right hon. Friend will have an announcement to make soon about the Portbury

scheme. A little earlier, my hon. Friend the Member for Southampton, Test (Mr. R. C. Mitchell) said that he considered that the first Portbury scheme had been rightly turned down. I disagree. There were recommendations from various bodies, including the National Ports Council, which said that it was a good scheme. I am certain that, when the Minister did turn down the initial scheme, the decision must have been a very close one. The City of Bristol has put forward certain alternative proposals embodying a much modified scheme. As the argument must have been, on all the evidence, very evenly balanced before, I hope that, when an announcement is made next month, the modified scheme for Portbury will receive my right hon. Friend's approval.

Mr. Robert Cooke: I am sure that the people of Bristol will be glad to know that the hon. Gentleman now favours that much reduced scheme. Will he say what possible benefit it will be to Bristol to have the scheme nationalised, as his right hon. Friend wants?

Mr. Ellis: I shall come to the question of nationalisation as I develop my argument.
The hon. Member for Tavistock (Mr. Michael Heseltine) said that, on certain aspects of passenger transport, there had been very little information. He will concede that on the ports side there have been umpteen papers and studies and all the factual information which anyone could want. Why were all these studies done?—because there was a malaise in the industry. All the phrases we use when we talk about modernization—roll-on-roll-off, containerisation, the container revolution—all sound marvellous. But what is the true position in the docks? Why have right hon. and hon. Members opposite waxed so angry about my right hon. Friend's proposals?—because we on this side realise what the basic problem is. It is no good talking about the freedom of the individual. In the port of Bristol, one could have all the choice one wanted. There were 70 stevedoring firms on the Bristol register, many of them with not so much as a bucket and spade or a wheelbarrow to do their work. Some were just names on the register.
Who is to do the work, after all the talk about necessary investment, about roll-on-roll-off and container systems? Will it be 70 stevedoring firms in one port? It is all quite stupid. If we discuss this matter seriously, we must recognise that there is much cause for concern and great need for change. This is where the question of ownership comes in.
In Bristol, the dock is municipally owned. We have a very good port authority. It is said that the municipal docks bring wealth to Bristol. I subscribe to all that. We have a good port authority doing a very good job, but where does the profit go from the great services which the port authority is running and from the wealth which comes into our port? It goes to the motley crowd of stevedoring firms, over 70 of them.
The books of account show that, over the years, nothing from this venture has accrued to the ordinary ratepayers and citizens of Bristol who own the municipal docks. Everything is ploughed back. It is ploughed back in various ways. Many of the functions of the stevedoring firms themselves have been taken over by our good Port of Bristol Authority. But the owners of some of the stevedoring firms are on the council and, what is more, they are on the docks committee itself. Even the hon. Gentleman the Member for Bristol, West (Mr. Robert Cooke) must concede that vested interests operate in Bristol. Naturally, the system suits some people very well. The profits from the Authority accrue largely to the stevedoring side of the industry, and it is inefficient at that.
We must have one employer in the docks. When we last discussed this matter in Committe, on the Docks and Harbours Bill, as my hon. Friend the Member for Southampton, Test said, all shades of political view were expressed. My hon. Friend is no arrant nationaliser of everything, but he knows, as I know, that on this side we are absolutely firm in our view on this matter, whatever our varities of political opinion. We were absolutely firm on the Standing Committee, and we are absolutely firm now. What we need in this industry, for the reasons I have given, is public ownership.
I feel this very deeply. When those of us who sat on that Committee discussed the great industry we were con-

cerned that we were going only half-way, that from the 70 people registered on the books at Bristol, we should come down to an indeterminate number and we have yet to see how many it will be.
My hon. Friend the Member for Kingston upon Hull, North (Mr. McNamara) spoke about the problems resulting from decasualisation.

Mr. Webster: The hon. Gentleman has talked about the 70 firms and the members of the Port of Bristol Authority. As he knows, there is no party politics in this aspect of the matter. Was it not a practice that whenever anyone who was a member of the Authority had an interest which was being discussed he not only declared it but refrained from voting? Is not that the common practice?

Mr. Ellis: I would not know what the practice is, but when I was on various local authorities a person like an estate agent would not sit on the planning committee, because he would also always have to be running out of the chamber. He could not make a decision about plans, because his livelihood would be concerned.
But at present the chairman of the docks committee is also a stevedore, as are many of the committee's members. I do not deny for a moment that they are conducting the business as the hon. Gentleman suggests, but because of their interest I cannot see that they can spend much time in the committee. They must be going out of the door most of the time because of the very nature of the work the committee does, and practically every matter before it must vitally concern their interests as stevedores.

Mr. Robert Cooke: The hon. Gentleman will concede that during the long years his party was in control there was no question of the stevedores being a majority, because his party held the majority. Even now, interested parties are not in a majority. Does the hon. Gentleman seriously suggest that there should be a port authority which contained no representatives of the shipowners and people with great experience of operating the port?

Mr. Ellis: The point I have been trying to make to hon. Members opposite is that when we talk of Bristol being a city that owns its own docks the profit


from the prosperity that the docks bring to the community in the way of trade, employment and so on does not return to the ratepayer but goes in large measure to the stevedore concerned. That is my point, and therefore I consider that the proposals are long overdue.
Having said that and said why I think that a change of ownership is necessary, I want to look on the constructive side. What will Bristol's future rôle be on the regional port authorities? I maintain that it will have a large part to play in organising the day-to-day running of the dock undertaking and the workers, and much more control in many respects than it has today. Therefore, we must have a careful look at the local propaganda and see where it comes from and with what motivations.
I want to say something about the existing position and the genuine fears of many people in the industry about the coming changes. The licensing of employers to get the number down to a tolerable minimum was seen as a necessary step to getting one employer on the docks. This is where the rub comes. One employer may be the best to work for at a certain time, and a docker will sign on for him because there may be a certain amount of bonus, perhaps because a dirty cargo is concerned.
But on another occasion another firm becomes the one to work for, if the docker can, and there will be difficulties because of transfers and dockers working 80 per cent. of their time with one firm and 20 per cent. with another. There will be these difficulties both at the inception of the scheme and as things develop.
I do not say this from any sectarian point of view, but for all the reasons I have given it is vital that on any dock undertaking there shall be only one employer in order to get rid of those variations of pay and so that every one knows where he is. To a certain extent we now have in Bristol, in effect, two employers. Men go to various stevedoring firms and a small limited number is employed by the Port of Bristol Authority. They are regular employees and the rest come from the pool and are allocated to different firms. To that extent, when we get individual employers with men permanently allocated to them it will be a step back

in some ways, and it is only right to sound warning notes. In some ways I regret that it has not been possible to go straightaway to the situation where there is only one employer.
I should like briefly to refer to the speech of my hon. Friend the Member for Newport (Mr. Roy Hughes). He talked about Bristol being in the same region as Wales, and I eagerly awaited what he would say on this issue. He rather sympathised with us for not getting Portbury, and then drifted quickly away from that matter. The whole point is that there must be central planning. It may be thought from time to time that we shall be in direct competition with our Welsh friends, and that we might compete for this or that item of trade.
But there is a whole host of issues on which even today we in the south west should be making representations to the Minister where our interests coincide. We know that it is absolutely axiomatic that the overall policy on development shall be made from the centre and that we need a strong national authority, when we regard the prospects of the Common Market and the undoubted development there has been of docks and harbours along the East Coast.
We in the west should also go together to the Minister and ask where our place is in the container revolution. We should ask, "When you use phrases like 'roll on, roll off' what provision is made for the west? Is it not necessary that we should not put all our eggs in one basket?" Perhaps we shall not get into the Common Market. I view it with great suspicion.
We also have the possibility of being able to transport our goods out from the west by the M4 motorway to London and the M5 to the industrial Midlands. We can go forward with our colleagues from Wales, who also want to make representations on this subject, and say that they have a like interest with Bristol.
We now see the plan emerging, and Bristol will not exist in a vacuum on its own—it will not go its own way. If we are not with Southampton but with the Welsh we must work together, and on a whole range of issues our interests are alike. When we get the regional ports authority we must see that we have a great


deal to say, because we are a large port in the neighbourhood.
I have been reasonably brief, but have said some of the things that need saying. I wish to close by repeating to the Minister, "Before you announce your decision on the modified scheme for Portbury, think well. We have had some disappointments in Bristol. It must have been a close argument on the original decision. In fairness and justice, in view of the amount of development taking place on the east coast, the time is overdue for us to be given some development down in Bristol." I commend the revised Portbury scheme to the Minister. I hope that she will think very seriously about it, and I trust that we shall be granted it next month when she makes the announcement.

8.20 p.m.

Mr. Nicholas Ridley: I do not intend to follow the hon. Member for Bristol, North-West (Mr. Ellis) into the question of Portbury, but in the course of my speech I shall be commenting on a large number of the things that he talked about.
I begin with the extraordinary words uttered by the Minister of Transport earlier today. She said that the facts show that in transport the only policies that work are Socialist ones. I think she will come to regret that statement. It is not true. I think it is true that the only policies which will not work are Socialist ones. There are two policies which could work, Communist ones and capitalist ones, and I very much doubt whether here is anything in between. I believe that the longer the right hon. Lady goes on in her present direction the sooner she will come to Communist ones.
The right hon. Lady got very mixed up—this is purely on the question of the ports—between public ownership, Socialism and the need for more efficiency. The container has, of course, come—it is not a Socialist invention—and we have economies of scale. We have all sorts of Pew techniques and ideas of productivity. But these are not to be confused in the least with public ownership versus private ownership. This is a different argument, and to confuse the two is to mistake the real nature of the decisions that we have to take.
The title of the document about ports, "Ports reorganisation", is a misnomer.

It should be "Ports nationalisation". What the right hon. Lady has done is to put forward a plan for putting the ports into public ownership. There is, however, no word of justification in the plan. The right hon. Lady just assumes that because public ownership is mentioned this will automatically cure the difficulties in the ports industry. As my hon. Friend the Member for Tavistock (Mr. Michael Heseltine) said with such conviction, we must have the facts and figures. There is the justification for this extraordinary policy?
I agree entirely that there is a need for action. Our ports are seriously under-mechanised. Labour relations and labour productivity are disastrously bad. One has only to visit Rotterdam or Antwerp to see how far behind we are. The risk of losing the entire transatlantic freight trade is very grave. I believe that already our prices are 10 per cent. above those of Rotterdam. We must do something about this.
Why are our ports so bad? One can apportion blame, saying that it is the fault of the bosses or the trade unions. There is nothing in my argument about that. However, what are the basic reasons why they have not worked? I list three. The first is the separation of the employers from their responsibilities as employers of their men. This is the subject of the Devlin Report and the decasualisation measures, which are going forward well and have the Opposition's blessing; indeed, we should like to go further still in this direction.
Secondly, there is the separation of the provision of the capital assets in the ports from the employment of labour. One cannot achieve more productivity by installing more machinery if one does not employ the labour. Similarly one cannot employ labour more efficiently if the provision of equipment is not within one's control.
Thirdly—here I am in some disagreement with some of my hon. Friends—I do not believe that the public trust system or even the municipal system of running docks is a good one, because a public trust or a municipality has not got the sanction of the Parliamentary questioning and Ministerial intervention, nor the commercial motive for making profits. I doubt very much whether this is the


right way to conduct an enterprise, although I accept that it is essential to have someone owning the waterway and dredging it and providing many facilities. But that is a different function from operating the docks and quays.
The Government proposal for public ownership is not relevant to those three problems. Like the hon. Member for Southampton, Test (Mr. R. C. Mitchell), I approach this not in any ideological sense. I am not interested in ownership so much as what leads to the greatest efficiency. The doctrinaire concepts of private ownership or public ownership might confuse our minds if we dwell on them as the main point. If public ownership is the more efficient, then it is right to have it; if private ownership is the more efficient, I am certain that hon. Members opposite would agree that the industry should be in private hands.
Thus, the first point is that we should have provision in the document before us whereby the National Ports Authority could hand back certain ports to private ownership if that were thought to be more efficient. There should be machinery for such a course. Yet all we see in paragraph 16, are the words
Further power to take over.
It is remarkable that there should be means only for transferring into public ownership but no means for transferring into private ownership. There is no real need for uniformity, because we read that the British Transport Docks Board is to be let off and not included in the scope of the machinery proposed. If the Board can be outside, surely private ports can be as well?
We have to have employers responsible for their labour in the docks. Yet I am amazed to see that there is no conclusion as to whether the dock labour boards will be wound up and whether, indeed, the port authorities will be the employers of labour or not. But this is vital because someone must look after the welfare, pensions, redundancy, amenities and all the other things which make a man content in his job rather than disgruntled and unproductive as is the case at present.
Lord Devlin laid stress on the importance of winding up the dock labour boards in due course, and we must be

told by the Government whether they are to be wound up, for this is clearly essential to the increasing productivity of labour. The way to greater efficiency lies through more containerisation and it may well be that the labour force in our docks will have to be halved in the next 10 or 20 years.
What worries me about the proposal for public ownership is that all the indications from other publicly-owned under-takings are that where there is public ownership the labour force tends to grow relative to what is needed rather than to diminish. The extraordinary thing is that since 20th July—the date of the great squeeze—the number employed in the gas, electricity and water industries has increased by 4,000, whereas the number in manufacturing industries has decreased by 339,000.
How can it be that in a period of economic squeeze and unemployment the nationalised industries can afford to take on more men? Or is it simply that private manufacturing industries have increased their productivity and efficiency whereas public industries have done the reverse? That question needs to be answered.
If one goes on to study the document, it says:
It will also enable further advances to be made in the improvement of conditions for workers in the industry.
There is no mention of productivity, so I presume it means that the dock workers will have a bigger slice of the cake and will be allowed to take a greater amount of our port management. One sees the dangers of this proposal. The example of the railways is not helpful, where the N.U.R. appears to wish to run the railways. Government of the N.U.R. by the N.U.R. and for the N.U.R. seems to be its object.
We have to be clear about the danger of the unions concerned trying to take over the running of this industry. It is all on the surface. They are saying now, as hon. Gentlemen opposite have been saying, that they want worker participation—

Mr. Dempsey: So does the Liberal Party.

Mr. Ridley: I want to explode that one. There is a difference between worker consultation and worker participation.
The document says:
A statutory obligation will be placed on the R.P.A.s to consult with the unions with a view to establishing and maintaining machinery for negotiation and regular consultation and discussion at all levels.
That is fine. I go along with that. However, it goes on:
In addition, provision will be made for worker Participation.
These are two totally different matters, and hon. Gentlemen opposite have been fooled with regard to the Iron and Steel Act by thinking that they have worker participation. What they have got is worker consultation, and the Minister of Power has been careful to make sure that he will only have on the boards of his steel companies workers who are divorced from active responsibility for the men whom they represent. He is right, because the idea of a union taking over the management of an industry can only result in that industry being run, not as an efficient undertaking, but as a haven of rest for those who work in it.
We have had a sluggish growth rate of 1 per cent. in the Government's three miserable years of office, and we shall have to invent a new phrase like "economic shrinkage" to make up the loss which will occur if this idea catches on. What is needed is more productivity. In Antwerp and Rotterdam there is 100 per cent. shift working, no restrictive practices and complete co-operation. However, in the whole paper there is no mention of the need to achieve these sorts of improvements. The only way in which they will be achieved is by having good, effective management being forced to respond to real financial and economic pressures, which are not mentioned in the document.
Now I come to the organisation of the industry, which is vital. It cannot be improved by killing competition. The proposals before us are for complete centralisation, and Ministerial control is substituted for the little competition and rivalry which is left. Is it intended that the industry should be run by the Minister of Transport? She is already running the railways, and it is clear that she intends to run every single undertaking within her ambit. I do not criticise her personally, but she is not trained as a manager and nor will her successor be. It

is wrong for a Minister of the Crown to run any industry. It is necessary to hire managers who have experience in running things to run the docks industry, and it is for this reason that I want a clear statement from the Government that they have no intention of trying to run our ports.
In this document we read the astonishing statement that National Port Authority will have
effective control of policy on such matters as finance, planning, investment, revenue targets, pricing, research, training and key appointments …
I want to know what the regional port authorities will do. There can be no autonomy left after that range has been covered. It seems that the only thing left to them is to design the uniforms of the officials who will be running the R.P.A.s, and it is clear that this industry is going to be run as a centralised bureaucratic structure, without any decentralisation, without any competition.
The shippers have made it clear that they are entirely against this.
There should be no attempt at centralised control, over and above that already exercised jointly through the National Ports Council and the Government.
This is what they say, but it seems to me that there are much more basic reasons why this is a mistake.
If there are several independent units, this, first of all, keeps open several different options. Hon. Gentlemen opposite have been arguing about whether Portbury should be in Bristol or somewhere else, whether the Portbury scheme should have been agreed to or not. I do not know, they do not know, nobody knows, but quite often by allowing two schemes to develop one backs the right horse among the two. If someone puts all his eggs in one basket, and it happens to be the wrong basket, he loses all his eggs. I believe that in technical improvements, whether it be one form of container berth, or a roll-on, roll-off berth, or whatever it it, there is great advantage in allowing different people to put different systems into practice. If a rigid requirement is imposed by the Ministry of Transport that all container berths shall be of a certain type or design, one loses the options which are available.
The second reason is the delay and the time it takes for schemes to go to the


top, be approved, and get back to the local people. But the third reason is that we will not attract people at the local level who will have the knowledge, the skill, and the drive which is necessary. We will attract only people who will be mere rubber stamps not able to put into effect the sort of policies which we need. I believe that this idea of central control of our ports is one more fatal nail which will do great damage to the economic coffin of this country.
I do not give two figs for the eight R.P.A.s. It is wishful thinking to dream up these regions. It means no more than the scribbling on the paper which it is. It is like a would-be dictator of a new African country planning his ministerial team, setting up boards to deal with this, that, and the other, and waking up in the morning to find that there is nothing at all. All this dreaming-up of regional boards gets us nowhere. What is needed is some way of bringing to this industry a real stimulus to compete, to modernise itself, to kick it into the twentieth century, using all the techniques and skills of management and mechanisation which are at our disposal.
When we come to denationalise the docks industry, if it gets as far as being nationalised, I hope that we will keep together the employment of labour and the instalment of capital equipment. These should be within the same unit. Secondly, we must have all sorts of responsibilities diversified throughout the country. We must bring the docks system back into its constituent units. There is no argument of economy of scale other than that one port must be an entity, and should not be cut into two, but we must find means of bringing back that spirit of rivalry, that responsibility for ensuring efficiency, which forces people to employ the best managers, which in turn forces the managers to make the fullest use of men and equipment. It is along these lines that the solution to our problem lies, and not along the lines of doctrinaire nineteenth century outright nationalisation. I hope that my hon. Friends will vote for the Motion, because in my opinion the proposed legislation is fundamentally against the best interests of the country.

8.40 p.m.

Mr. Leslie Huckfield: First, I thank you, Mr. Deputy Speaker, for giving me my normal Tuesday night spot just before nine o'clock. I listened carefully to the speech of the hon. Member for Worcester (Mr. Peter Walker). I always listen carefully to his speeches, because for about 19 years of my life I lived just outside Worcester. My father is still one of the engine drivers who works at the local engine sheds that the hon. Member would like to close down. We have heard that the hon. Member has about 18 study groups working under his guidance to produce something on transport policy for the party opposite.
I listened especially carefully tonight, because the hon. Member should be able to talk with quite a little experience about the transport problems of Worcester. Ever since the war he has had a big transport headache right in the middle of his constituency, namely, a bus company which is supposed to provide a public transport service in the area. I shall refer to that later. I only say now that if this is all that these 18 study groups can produce up till now, if they think that they will produce a policy before the next General Election they are going to have some hard work to do.
Reference has been made to conurbation transport authorities. Everywhere we look at the moment we see that the system that was set up in the 1930s, especially under the 1930 Road Traffic Act, seems to have ground to a halt. We now have a system where every time a bus company increases its fares people flock to their cars. Because they use their cars congestion increases, bus services slow down, the bus companies lose more revenue and have to increase their fares again. This vicious circle has been perpetuated, and in certain parts of the country it has reached the stage where, if a company increases its fares, and the elasticity of demand is unity—to use a technical term—the number of passengers decreases correspondingly and total revenue does not increase. The only solution is to break the vicious circle somewhere, and this is what the proposed legislation should do.
I regard the proposals for passenger transport authorities as one part of a whole series of wider measures designed


to deal with the problem of transport in the urban areas. It is not merely a question of implementing the Buchanan Report. How I wish the Buchanan Report had mentioned the word "cost". It is not merely a matter of implementing that Report; it is a matter of doing something about the whole problem of road, rail, public and private transport in our major cities. The proposed legislation will seek to do that.
In the existing system we do not see the kind of competitive position to which one or two hon. Members opposite have referred. The whole purpose of the legislation of the 1930s was to prevent competition in the operation of our road passenger transport services. The purpose of the 1930 Road Traffic Act was to set up companies which, over a wide area, were the sole providers of transport, without fear of competition from new entrants to the industry because those new entrants would have to go before the traffic commissioners and would not be granted licences.
In the present situation large companies dominate their territories without any competition. At the same time, we cannot get at these companies until they come before the traffic commissioners, and the procedure in that connection is not very effective. The situation has now developed when there has to be cross-subsidisation. Certain companies with only 20 per cent. or 30 per cent. of their total mileage that pays have to use that 20 or 30 per cent. to cross-subsidise the rest of the mileage that does not pay.
The Midland Red Bus Company, which is half owned by the Government, is in this case. It has about 8,000 employees and claims to run services for about 300 million passengers a year. Because it is so large in its area, only 30 per cent. of its mileage pays and it has to rely on that to subsidise the 70 per cent. in the conurbations and outside which does not. This company earns a lower rate of return than any in its group and lower, on average, than most others in the industry. Instead of campaigning against nationalisation, surely it should accept that it would be the most acceptable thing for the Midland Red.
The company and its general manager should not campaign about nationalisa-

tion stamping out these services, because without nationalisation of such companies these services will have to be discontinued, as the 30 per cent. can no longer pay for the 70 per cent. The truth is exactly the opposite of the case being made by our friends in the company—

Mr. Ridley: Is the hon. Gentleman suggesting that the nationalised concern should continue to carry a much greater amount of uneconomic services than the present Midland Red? Surely the result would be mounting subsidies for the taxpayer? How would he deal with that?

Mr. Huckfield: I said that the company's financial position was becoming serious and that something would have to be done.
If we carry on like this, with increasing subsidisation, fares in certain areas will have to rise even more to pay for uneconomic services. Whenever this company and others put up their fares, the number of passengers will fall off correspondingly, leaving their revenue constant. Many bus companies are in this situation. The company runs a cunning campaign, claiming on stickers on its buses that it does not contribute to the Passenger Vehicle Operators Association. It is getting so much publicity that it seems as if it does contibute to the T.V.O.A. and it must accept that its stickers are on buses in which the Government have a 50 per cent. stake.
Railway lines have also been closed down without reference to the social cost. A study of social cost benefit would have been a good idea. A line in my constituency between Nuneaton, Coventry and Leamington had a good case for being kept open on this basis, but, because the previous Administration's only criterion was pure profit, it was closed and people are 15 or 20 minutes late for work every morning because they use the alternative service of the Midland Red.
Hon. Members opposite have said that nationalisation would interfere with private enterprise and that companies would be taken over without compensation, but, including the territorial companies, those of the municipalities and the independent operators, there are


about 80,000 buses in the company, of which about 60,000 are either entirely or half owned by the Transport Holding Company, or they are part of municipal bus fleets. Yet we have been told today in strong terms that the Government are proposing to carry out the wholesale nationalisation of road passenger transport. At least one of the 18 study groups which is said to be working in the Conservative Central Office ought to have found out about this.
Apart from one or two jingles about the Selective Employment Tax and the fuel tax, we have not heard an alternative solution today from the Conservative Party. We have heard mumblings about giving this and that back and about congestion and the Buchanan Report, but nothing to deal with the kind of situation to which I referred earlier which faces the people in our cities at this moment. Do hon. Members opposite think that we should go back to competition? If so, they are wrong. Do they think that we can run a public passenger transport service on the lines that existed before the Road Traffic Act, 1930, when pirate buses would drive up to a bus station and pick up someone else's passengers, and then nip down the road before the authorised operator arrived? That is what competition meant—and if that is what the Conservative Party mean, they should say so.
In the conurbations we already have chaos. In the Birmingham conurbation there is the Birmingham Corporation transport service, the Walsall Corporation transport service and the West Bromwich Corporation transport service—and, in addition, Wolverhampton provides its transport services. Somewhere between all these we have the Midland Red. We are reaching the stage at which even the bus companies realise that by themselves they are not big enough to operate the services, and they are having to introduce joint operations. They are having to introduce by themselves the very thing that is envisaged in the proposed legislation.
We have been told that the ratepayers will have to pay for the national transport deficit. I have news for the Conservative Central Office. For a long time

local authorities have been empowered to raise rates to subsidise their transport departments, and most of them already have to do so. It is not a matter of ratepayers in future having to put their hands in their pockets to bail out the corporation transport authorities. Most of them have to do it already, because of the crazy economics to which I have referred several times.
We already have co-ordination and payment by the ratepayers. At the same time we still have the crazy mixed-up situation where in the bigger conurbations some of the municipal undertakings compete against each other. The public are losing out every time, congestion is increasing and railway lines are being closed. Unless we take everything under one umbrella we shall get the kind of situation which they had in San Francisco and Los Angeles all over again, because we shall find in the 1990s or the next century that we have to rebuild the railway lines and to start the bus services all over again. I would much rather see £50 million spent on improving public transport facilities now than £100 million or £200 million have to be spent a couple of decades from now.
This is the policy envisaged by the proposed legislation. I have questions to ask about it. I want to know how the rural bus services will be provided for and how we shall pay for services which are unremunerative now and which will still be unremunerative under the proposed legislation. By and large, unless we get the municipalities, territorial companies and all the other services together, we shall find ourselves in chaos and confusion instead of having an integrated working of the whole system.
Much has been said by hon. Gentlemen opposite about threats to nationalise road haulage undertakings. When I think of some of the companies which have been voluntarily acquired by the Transport Holding Company I cannot understand why they talk of threats. George Reid and James Express Carriers were not acquired by threat but completely voluntarily, and that is envisaged by the proposed legislation.
In any event, hon. Gentlemen opposite must come clean when they speak about the nationalisation of the road haulage


industry. When one considers what happened in 1953, it is obvious that the Conservative Party never intended to completely denationalise British Road Services. Even after the passing of the 1953 Act hon. Gentlemen opposite went on to improve some of the B.R.S. depot facilities. They acquired the Atlantic Steam Navigation Company in 1954 to provide the ferry services which B.R.S. now operates. When they talk about competition in road haulage they must come clean.
So far, the record of hon. Gentlemen opposite is not one of competition but of convenience. I am the first to admit that there may be a place—a small one—for the private sector in road haulage. I could quote some good examples of co-operation in the private road haulage sector. Consider the amount of fruit and vegetables shifted out of the Vale of Evesham every night. I wish that the hon. Member for Worcestershire, South (Sir G. Nabarro) were here to hear me say that.
I have done a fair amount of long distance transport driving. In my experience, any flexibility that may exist in the private sector exists at the expense of the driver. It is the driver who must work 120 hours a week, who must earn it on tip money and who is called out of bed at two o'clock in the morning and told, "Get down the road to Manchester". Contrast that with B.R.S., in which no driver gets paid for more than 10 hours' work, anyway.
If we are to have flexibility in the private sector, it must come as a result of that sector organising its activities properly and not because the driver is flexible. I hope that, as a result of this policy of acquiring sectors of the industry voluntarily, we will afford scope for the operation of a small private sector which will be flexible.
I must conclude my remarks because I see that my usual time to sit down is approaching. As a long distance driver, I went to the docks on a number of occasions. I often went to Southampton. I would arrive at six o'clock Monday morning and, if I had not managed to tip the chap at the front of the queue to take off my load, I might still have been there the following Thursday morning. Something must be done about the docks. Hon. Members need only go to places

like Merseyside and the P.L.A. to see lorries queueing up, often having to wait for hours if not days before unloading. It is not an exciting spectacle.
Can anyone wonder why restrictive practices come about? Consider, for example, the way in which drivers must queue up to sell their labour, or otherwise rely on their measly fall-back pay of £10 a week. For me, the nationalisation of the docks will improve matters from the workers' point of view. There must be better amenities and de-casualisation. Decent port facilities must be provided. It is up to us to provide them because, under the set-up that has existed so far, they have not been provided and, unless changes are made, they will never be provided.
No constructive alternatives have been put forward by hon. Gentlemen opposite for improving the docks. We have been trying to discern a transport policy in their remarks, but they would prefer to leave things as they are. They want to see lorry drivers queuing from six o'clock on Monday morning until the following Thursday. Unless we do something about the docks the present set-up will continue to bedevil improvement.
The McKinsey Report—and I hope that hon. Members opposite will try to find time to read it; it will not take too long, and it has plenty of pictures—envisaged that with container ships only four ports will be needed to serve the country. We cannot therefore talk of competition, or play off one port against another. The work must be planned. We shall have neither the room nor the money for a whole series of ports round the country with container berths and roll-on roll-off facilities. The mistake of playing off one port against another was made on the West coast of America.
If we are to get the container berths, the unit trains and effective transfer from road to rail and vice versa, we must work on an integrated centralised basis. That is what this debate should have been about. Primarily, it is not about whether we should nationalise or denationalise but about improving the nation's transport services. That is what we on this side have been trying to talk about. This is what is envisaged in the prospective legislation, and it is what I shall vote for


tonight. I hope that hon. Members opposite will treat the matter with the same kind of seriousness.

9.1 p.m.

Mr. David Webster: It is a depressing commentary on both the Government and our economic prospects that at a time when sterling has been under pressure for a thousand days the Ministry of Transport, whose task it is to create conditions for the improvement of the distribution of goods and freight—which represents, in fact, 10 per cent. of the gross national product—can envisage in two Bills during the next two years only a reshuffling of the constitution of those methods of transport. There is no proof in any of the documents that have come to me, or in the facts referred to by my hon. Friend the Member for Tavistock (Mr. Michael Heseltine) that anything positive will he done to improve the movement of goods, freight or people.
That improvement is what we on this side have been seeking, and successive Ministers of Transport, particularly my right hon. Friend the Member for Wallasey (Mr. Marples), made a great deal of effort to accelerate movement. My right hon. Friend commissioned reports whilst at the same time himself acting. We had the Rochdale Report, which has been referred to in this debate, and the Buchanan Report, which has also been referred to. The Jack Report on rural transport has been implemented. On a great deal of that policy we stand firm at present, but it is not for us today to put forward policy.
Our job is to examine the operation of Government policy. That is the business of Parliament. It is particularly the Opposition's job. Government back benchers, too, must be reminded that their job is to examine the Executive and its functions and discover how the Government are carrying out those functions.
Our ports are still handling at least 90 per cent. of our exports, and we now face the challenge and predicament presented by the international terminals that are being created on the Continent. There is Europoort at Rotterdam—I am glad to see the hon. Member for Bristol,

North-West (Mr. Ellis) nodding agreement, because he knows that Rotterdam is a civic port. I believe that the ports of Antwerp and Hamburg are also civic ports.
Those ports with their deep water facilities, with their facilities for handling bulk cargoes and container cargoes, built up often by a local authority with devoted and with civic pride and with an understanding of the trade which goes through those ports, have built up such a threat to our trade that we are faced with a challenge which is not simply a trading challenge because with the development of the port goes development of investment within the area of the port, development of the moving of merchandise, and the financing of bills of trade which go with it. If we lose the long sea trade into the European ports, we shall lose many of these methods of invisible earnings which have made this country great and prosperous in the past and the present.
As my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) said, we should be reduced simply to the rôle of fetching and carrying our own domestic requirements. The Minister's answer to this is simply to meddle with the structure of our transport industry, give it a central control and impose a new bureaucracy upon it, forgetting that the greatest developments and progress in our ports have been of a civic nature. I am not saying that this is the only method of improving the industry, but there is nothing to commend nationalisation of the ports system.
What we should have is investment plans for our ports. We now know that there will be uncertainty for the next four years because that will be the vesting date. Who will invest in facilities for the ports if they know that they will not be able to operate them at the end of the day? We are held up by this nautical Nero who, because of her political dogmas, is determined that we should not proceed with this necessary investment.
The same is true of the National Freight Authority. Who wants it? What good will it do—this was ably brought out by my hon. Friend the Member for Glasgow, Hillhead (Mr. Galbraith)—in the speeding of goods and the cheapening of the movement of goods? Do the


hauliers want it? In fairness, the Minister said that she does not propose to nationalise the road haulage industry. She goes to America and makes statements there, so she will agree with the statement made by the Prime Minister on 3rd April, 1963, in Washington:
We shall rebuild this integrated system, not so much on the basis of buying off every lorry, every truck, every little back-street garage that has got four or five broken-down lorries together with the goodwill and pay enormous sums to them as we did last time, but on the basis of taking the lid off the already nationalised British Road Services.
This is what we are seeing today. We are seeing the National Freight Authority to be imposed by Act of Parliament.
We have had the promise by the Minister today of a new licensing system. There are so many leaks that this should be called the Sieve Ministry. I understand from the inspired leaks which come my way that there will be increased and restrictive licensing for any long-distance haulage and relative freedom for the short-haul. What then will be the competition between the long-distance haulier and the new freight authority? There will be no fair competition. The freight operator will be squeezed out of business into bankruptcy. The bankruptcy rate in this industry is very high indeed. This will not be good for the new freight authority, nor for the railways. They do not want it.
The right hon. Lady seems to have heard today of movement by container for the first time. Moving from a container directly on to a ship and on to the customer's country is a new invention. How is that to help the railways if it is known that the railways will have it taken away from them? There has been much talk in practically every transport debate about morale on the railways because of the continuing losses. How will these proposals improve the railway's chances of meeting their financial objective and of doing something progressive and of bringing back their self-respect, if all that is to be allowed to them is to keep the rump of their minerals traffic? What good will it do.
Hon Members opposite ask what policy we are presenting. We are examining this policy and asking what good will it do. What will it do to produce a better service? What will it do to

reduce charges? What will it do to reduce the load on the overburdened taxpayer? This is some one we should refer to occasionally, even if only in passing, when discussing this subject.
A little of the light of day has been cast upon the proposal in relation to buses. We have had proposals which have been confidential until today. I understand that now, after they have been published in various newspapers, and after there have been various leaks from the Ministry, at last they are to be put into the Library so that all hon. Members can see them. That is a step forward. We also understand, as the result of the expert probing of my hon. Friend the Member for Worcester (Mr. Peter Walker), that some of these proposals are to be taken back. So we are in an even greater state of query about the whole situation.
Are we to go back, not only in concept, but in technique of development as well, to the 1947 Act? That Act was in spirit brought up by the Minister in the form, not necessarily on this occasion of area schemes as a form of covert nationalisation, but of the conurbation transport authority and now the passenger transport authority. There was in the 1947 Act the first stage of preliminary consultation, with both the municipalities and the operators. As I understand it, consultation is now going on. We want to know how this consultation is proceeding.
The next stages under the 1947 Act were the publication of a scheme, then a public local inquiry, and then the special Parliamentary procedures. We want to know to what extent the Minister proposes to follow this procedure. What consultation is she to have? Will it be adequate consultation? Will it get down to the business which my hon. Friend the Member for Manchester, Withington (Sir R. Cary) explained so well to the House? I am not satisfied that it will.
Answering a supplementary question put by myself, the Minister said this last week:
Adequate consultation consists both in detailed discussion by my officials with the people concerned and in my receiving personally any representations which appropriate organisations wish to make to me."—[OFFICIAL REPORT, 12th July, 1967; Vol. 750, c. 800.]


I want to ask about the elaborate and "detailed discussion" and how the personal representations will take place. In this case there is to be no formal procedure for the hearing of objections if the property of individuals—that is, shareholders—is to be expropriated without adequate consultation. I remind hon. Members opposite that they are representatives of taxpayers and of ratepayers, who will be adversely affected by this legislation, and that it will be their duty to search their consciencies and to search the Minister in the years that lie ahead to ensure that there is adequate compensation for those that returned them to the House.
We know that it is vital that we probe these matters now, because we have the Minister's own word for it that this matter is not negotiable. She proposes to bulldoze the thing through. We on this side have initiated this debate so that the House and the country can have a preliminary view of it and the people can be alerted to what is happening to their assets.
Every citizen in this country, in one way or another, will be disappropriated by the legislation that is coming forward. We are told that it is not negotiable. The Minister laughingly said that, no doubt with her fine sense of democracy. There is no formal procedure for objection. My hon. Friend the Member for Tavistock explored this matter very thoroughly.
As there is no method for objection, we want to object now. We want the country alerted now. We shall alert the country again on the Second Reading, and we shall continue during the debate in Standing Committee to improve this Bill so that the people get justice and democracy. [Interruption.] I would refer to the remarks of Mr. John Davies, the Director-General of the C.B.I., in the Sir George Earle memorial lecture on 13th December last year, entitled "Industry and Government". Did the hon. Member wish to interrupt?

Mr. William Price: I said that the hon. Gentleman sounds as if he belongs to this side of the House.

Mr. Webster: One day the hon. Member will be on my side of the House—

Mr. Price: The hon. Member should not believe that.

Mr. Webster: —or perhaps he will lose his seat. We shall be very sorry to lose him if he does.
Mr. Davies, with his great experience, talks about
a veritable maze of consultative groupings conceived with the dual objective of genuinely acquiring knowledge of the workings of industry on the one side and, on the other, of quietening fears that it may be preparing to act in an arbitrary or impulsive manner.
He says:
There is something of the spider and fly encounter"—
I think this is particularly apposite in this case—
implicit in Government/Industry consultation even when carried out with all the niceties of administrative consideration. It is a process that risks making enemies rather than friends.
I come to the point of compensation. I want facts from the Parliamentary Secretary. I want to know how are the terms of compensation to be arrived at. Is there to be an independent valuation? On what basis are the assets to be valued? On how many years' earnings are they to be valued? Is it to be on the basis of the 1947 Act, namely, the floating debt? I admit that under the 1947 Act there was a sum of £2½ million extra in reserve, over and above the floating debt, but if the Ministry confines itself entirely to the floating debt a tremendous injustice will be done.
I would particularly alert anybody from Birmingham to the great injustice that will be done because Birmingham Corporation transport, with assets valued at £10 million, has no floating debt, and if the undertaking is nationalised or taken over on the basis of the floating debt, there will be no compensation to the ratepayers of Birmingham.
Some time ago Alderman Watton of Birmingham was on record as saying that it did not worry him a bit if the Birmingham ratepayers did not get a penny compensation. I should think he is probably changing his views about that now. If he is not, the ratepayers of Birmingham will probably want to change him. This is a matter of principle, on which Councillor Sissling of Bradford said that in Bradford they viewed with great alarm the prospect of


a debt-free undertaking being appropriated without any compensation to the city. If this practice, the 1947 practice, is followed, great injustice will be done to both those cities and the many other undertakings which stand to be taken over by the P.T.A.s under the coming legislation.
Who is to pay the compensation? Will it be the Treasury? If so, the Treasury will insist on control, and then there will be even greater control than has been envisaged so far. In three years, the local authorities or the conurbation transport authorities will be able to precept the local authorities within their area for the rates. In the meantime, they will receive assistance from the Treasury. But three years is not a long time. The ratepayer will have been expropriated of his property and, more than that, in many places little versions of the London Transport Board will have been set up. What a nightmare. In 1964, London Transport broke even. Last year, it had a deficit of £5·6 million. This year it is running to £7·5 million. If we are to have this sort of burden throughout our big cities, with the ratepayers expropriated of their property, the hue and cry will be quick to arise.
We want to know about compensation and about the other consequent detail, as the Minister of Transport engagingly calls it. It is not consequent detail. It is a matter of great principle, a matter of compensation, a matter of assistance to the ratepayers, and it is also a constitutional matter of central control. If anyone imagines that the transport services will be run by the local authorities and conurbations concerned, by these great and proud cities, he will be quickly disillusioned. Not only does the financial pattern ensure control from the centre. The constitutional basis ensures it also.
There are to be specific grants for major capital projects. The Minister of Transport will approve the terms, will supervise the detailed financial agreements, and will provide infrastructure grants. All this means central control. The piper pays the tune in any country, but if the British Treasury has a say in what is going on, there is central control with a vengeance.
Now, the composition of the boards of the authorities. The Minister has the

right to refuse the appointment of any person to the board if he be a person unsuitable in her eyes. That is the most sweeping abrogation of local control that there could possibly be. It is an utter veto on any member not pleasing to this Minister. Further than that one could not go. Moreover, in such a case, the Minister may act by default and appoint her own nominee.
The House has been told these things two or three times, but I want the country quickly to know. I want these cities quickly to know, and other places away from the cities as well. This is to be the prototype to be spread throughout the country. One-third of the membership of every board will be appointed directly by the Minister. They are called independent members of the board. The Minister's sense of humour fills me with delight. As my hon. Friend the Member for Hillhead rightly said, not only does she have the authority and control to which I have already referred, but she has the right also, of her own nomination, to appoint the chairman, and he must have her approval before he appoints the chief executive. This is the situation as we see it. We are told by the Minister tonight that the document is no longer firm but only contains various proposals. Let us hope that the debate has caused them to be taken back, because the document is not anything to improve local transport. It would simply increase an ambitious Minister's powers.
On the subject of consultation, we know that she has gone around to various cities and adopted a skilful technique—she is a very skilful person. She pledges the local authorities to complete confidentiality and then has a Press conference. She holds a private meeting with the Press, and the next day the members of the local authority who have been talking to her in confidentiality, they think, see her name and proposals all over the papers. They become a little fed up with this and with the inspired leaks and begin having their own Press conferences. They become a little disillusioned by what is going on.
I remind the Minister that it may be very well for her to desire to centralise from Whitehall in the case of both the docks and local transport undertakings. That might be fine, but there is a great


reaction against centralism in this country at present. She will know from the local election returns and the by-election returns that there is a great movement towards national and regional parties. Those people will not take kindly to having their local undertakings centralised on Whitehall. A large part of their day is spent on the local buses, going to work and returning home.
Therefore, we want to know what there is in any of the proposals for the docks, the buses and the movement of freight which the Minister will introduce in two Bills in the next two years to give better service, better timekeeping, better consideration for the people who use them, better labour relations, and, in the case of rural transport, maintaining an adequate service.
The Minister's function is to create the conditions in which free industry, whether locally or privately controlled, creates the best work it can to give a service to the public—in the case of the docks creating a faster turn-round to give an efficient service to the ship while it is in harbour and cheaper dues, and getting the ship away fully loaded as quickly as possible in competition with the foreigner. I see nothing in her proposals to achieve these objects.
In the case of the freight authority, what we require is a faster, cheaper and more reliable service, and I see nothing in the proposals that will achieve it. There is nothing in the proposals for the buses to give a faster, cheaper, more reliable service, taking the needs of the locality into account. In each of these cases there is simply a blatant grab by an ambitious Minister and, as someone else said on the subject of public ownership and Clause 4, we will fight, fight and fight again.

9.28 p.m.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. Stephen Swingler): As has been usual in debates on transport matters, a large number of detailed and local points has been raised by those who have cared to attend the debate, and it is not possible to cover them all in winding up. But I give the assurance, which I think we have always managed to fulfil, that we shall not only take note of all these points but shall reply

to hon. Members on both sides in due course on the particular questions they raised.
I have much sympathy with my hon. Friend the Member for Southampton, Test (Mr. R. C. Mitchell) who, I think, said that he was puzzled as to why we were having a debate on this Motion today, the Motion being about the threat of further nationalisation of bus operators, road hauliers and the ports and docks industries. After all, this is an important Supply day in the hands of the Opposition towards the end of the Session, a wonderful opportunity to make a survey of the real problems confronting the people. It was a very advantageous chance for the Opposition to put forward a constructive contribution of alternative policies to those being advanced by Her Majesty's Government. But what have we found? The debate was selected by the hon. Member for Worcester (Mr. Peter Walker) supported by his 18 sub-committees, and he selected this totally negative, wholly dogmatic and utterly sterile Motion which simply and solely invites the House to oppose nationalisation.
Hon. Members opposite who have dealt with the subject of the Motion have advanced the proposition that there are no virtues in national ownership at all, no advantages to be gained from national planning, and nothing of benefit to the community by the national integration of transport services. As my hon. Friend the Member for Nuneaton (Mr. Leslie Huck-field) said, one might have imagined that hon. Gentlemen opposite would have totally extinguished nationalisation in the transport industries and services when they had the power.
After all, it was hon. Gentlemen opposite who were responsible for the present structure of British Railways, British Road Services—the part that they could not sell—and the British Transport Docks Board, which some of them are so fond of knocking on every occasion possible. It was the Conservative Government who, by a series of Acts culminating in the 1962 Act, were responsible for this state of affairs.

Mr. Geoffrey Wilson: The hon. Gentleman will appreciate that when one breaks eggs it is not easy to put them back in their shells.

Mr. Swingler: I appreciate that the hon. Gentleman and his hon. Friends either had not the competence or had not the guts to implement the Motion which they bring forward to the House today when they had the power, if they really believed in it, to denationalise the transport industries and services. My right hon. Friend inherited this state of affairs of the mixed economy of national ownership, municipal ownership and private ownership in the transport industries and services, but in the disintegrated way which the Tories created by means of the 1962 Act. My right hon. Friend is engaged in trying to produce integration where they deliberately disintegrated and co-ordination where they introduced conflict, but, above all—this is something which some hon. Gentlemen opposite apparently cannot understand—to introduce into transport policy the concept of social benefit and responsibility.
I turn immediately to the question of the passenger transport authorities and the comments of the hon. Member for Manchester, Withington (Sir R. Cary). Over a wide field the arguments put forward by the Opposition have been answered by my hon. Friends the Members for Dunbartonshire, East (Mr. Bence) and for Nuneaton. Let me set out again clearly the principle as enunciated by my right hon. Friend.
My right hon. Friend has declared for some time that it is her policy to maintain and revive public transport in the country and especially in the towns. This is a function which must be combined with the exercise of traffic control and the development of traffic management, which is in the hands of the principal local authorities, and it is, therefore, indispensable, if we are to cope with the motor car revolution—the spread of car ownership—and are to enable public transport to move and fulfil its basic function and to get co-ordination between skilful traffic management and bus and train operations, to bring under one single authority the organisation of passenger public transport. That is the principle on which my right hon. Friend is working.

Mr. Michael Heseltine: Is the hon. Gentleman now describing the passenger transport authority as it is today in the latest memorandum, or as it was in the memorandum six months ago?

Mr. Swingler: In his speech, the hon. Gentleman began by saying that he was not challenging the idea of a single authority able to exercise supervision over land use, traffic control and public transport operations, and so on. But he went on to object to my right hon. Friend taking the steps needed to bring into being in advance of local government reorganisation the machinery to do it. My right hon. Friend has answered this point on several occasions.
In our view, we cannot wait until we get the reorganisation of local government to set up this kind of authority, and that is precisely why my right hon. Friend is taking the initiative to consult the local authorities and others on how, under broad local authority control, public passenger transport authorities can be set up.
I appreciate that hon. Members opposite are entitled to have their fun about the leakage of documents, including those which they or their associates have leaked themselves and which have appeared in anti-Government newspapers and magazines. But I ask them whether they consider that my right hon. Friend should carry on consultations on these matters or not. If they think that such consultations should be carried on, and if they think that, in them, she should take account of the views of the local authorities, the local authority associations, the operators' associations and others, then they will appreciate that it is necessary for those consultations to be carried on in an atmosphere of trust and that, in such circumstances, it is not possible for public argument to be carried on about every detail and every matter. Arguments have been adduced in the debate based on various documents which are now superseded and hon. Members will not expect me, since these consultations are going on and since my right hon. Friend takes them seriously, to answer the detailed points that they have raised.
Another peculiarity of the hon. Member for Worcester in having initiated the debate is that he knows very well that my right hon. Friend has promised a White Paper on this subject, when the consultations have been completed, in which all these matters will be set out. He knows


perfectly well that legislation is required to carry these aims into effect and that, therefore, all hon. Members will have a full opportunity to debate the merits and demerits of these proposals again when the consultations have been completed.
But the hon. Gentleman would not expect my right hon. Friend, when she is engaged in such consultations and in such a relationship with the local authorities, to give off-the-cuff answers to a whole series of detailed questions which are precisely the subject of the conversations she is carrying on.

Mr. Peter Walker: Does the hon. Gentleman agree that the publication of the White Paper, if it comes in Parliamentary time, will be 28th October, and that the right hon. Lady has promised the Second Reading of the Bill for November? Are we to have a debate on the White Paper before the Bill is published?

Mr. Swingler: We shall have to see about that. As far as I know, no one has previously raised this question, and no one has said not. I would have thought that hon. Members would first of all wish to consider the White Paper. When my right hon. Friend has finalised a policy and set out her proposals, in the knowledge that they will be followed by legislative proposals, it will clearly be a matter for discussion at that stage as to how the views of the House can be expressed.
I have reiterated tonight the general principle, because some hon. Members have tried to suggest that, in some way, my right hon. Friend is departing from the principle of the matter. The principle is that she has put forward proposals for the establishment of passenger transport authorities under broad local authority control. She is also putting forward proposals for capital grants by the Government to assist the re-equipment of public transport and for Government financial responsibility in respect of a subsidy for rural transport precisely to maintain and revive public transport, because that is basic to her policy.

Sir Harmar Nicholls: But what is Parliament's function? The Opposition are part of Parliament and, because discussions are going on which will be important to the country's transport, they have initiated a debate to

probe it. They have asked questions and, wherever they have got their information from, it is Parliament's job to see that they are properly answered, so that if there is any point—

Mr. Speaker: Order. Interventions by hon. Members who have not attended the debate must be brief.

Mr. Swingler: The hon. Member for Peterborough (Sir Harmar Nicholls) is not completely in the picture, because he has come in only at a late stage.
It has been made clear for some time what are the basic principles of my right hon. Friend's policy in regard to public transport in the towns and the relationship between the operation of public transport and traffic management. She has also put forward proposals for capital grants and for a rural bus subsidy.
These are matters on which my right hon. Friend has been carrying out consultations with local authorities on a very wide scale. It is right that she should do that and continue to do it, and she has undertaken to inform the House in a White Paper about the detailed character of her proposals when these consultations are concluded. I suggest that it is at that stage that hon. Members will receive the answers to the detailed questions which have been raised and, of course, it will be possible to debate them.

Mr. Galbraith: The hon. Gentleman said that his right hon. Friend was having discussions with various local authorities. One question which I raised was whether Scottish local authorities are included in the discussions.

Mr. Swingler: The discussions have been going on with local authority associations and others on a nation-wide scale. I am sure that the hon. Gentleman will have read the White Paper and will know, therefore, that the discussions concern the whole country.
A great part of the debate has been devoted to the working document published by the Government for the purpose of consultations on the nationalisation of our ports and docks. I am grateful for the speeches made by several of my hon. Friends, including the hon. Member for Newport (Mr. Roy Hughes), the hon. Member for Southampton, Test and my hon. Friend the Member for Kingston


upon Hull, North (Mr. McNamara), who have commended the document and made detailed comments on which they will receive replies later on. I emphasise that the document is put forward genuinely for the purpose of the consultations, and that these will be carried on over a considerable period.
I want now to deal with the speech of the hon. Member for Portsmouth, Langstone (Mr. Ian Lloyd). I was surprised at the tenor of it. It appears that, whenever he speaks, he has to "knock" the Docks Board, I suppose for ideological reasons. Nevertheless, he put forward the proposition that he was in favour of unified control of the ports and that, as I understood it, he was in favour of centralising information—resource allocation, as he called it—but dispersing decision making. I made these notes from his speech.
If the hon. Gentleman has read the working document carefully, I cannot understand how he imagines that the principles which he wants to see developed in national port policy can be achieved without implementing the principle of public ownership. It appears to us that containerisation, which is the important thing today, makes public ownership not merely desirable, but imperative. Containerisation is having the effect of turning the port industry from a labour-intensive industry into a capital-intensive one, and we cannot afford to duplicate these expensive facilities all round our coasts.
If we try to do that, we shall burden industry with intolerable and unnecessary transport costs. It is, therefore, essential, on the hon. Gentleman's own argument, to have a strong central authority which will see that port investment serves the national interest rather than purely local interests.
During the debate an hon. Gentleman disclosed that he had not read the McKinsey Report. I think that the hon. Member for Langstone has read it, but he attempted to use the argument of the advances in containerisation and modern development in the United States as an argument against the proposal that public ownership was a necessary step to achieve the kind of planning that we want. I would like, therefore, to draw the attention of the hon. Gentleman, and of other

hon. Members, to page 58 of the McKinsey Report, where it says:
Port authorities face the same dilemma as ship operators—
Either they must expand by providing new container facilities or experience progressive loss of general cargo trade to those that have—
However, if many authorities decide to provide facilities, substantial over-capacity will result in this industry as well.
As indicated, one container berth can replace up to 20 break-bulk berths…
The problem is especially acute in countries like the United States where there is no national co-ordination of port investments.
On the United States East Coast, most traditional general cargo ports are independently developing container facilities, only a few of which could handle the entire trade if fully utilised.
On the West Coast, San Francisco and Oakland may shortly be developing facilities to compete for the same trade.

Mr. Ian Lloyd: One of the things which the McKinsey Report has not pointed out, and a fundamental philosophical disagreement arises, is that the container revolution makes possible a wide development of small selected transshipment points. There is no reason why a small port, either in the United States or in Great Britain, should regard itself as debarred from this development.

Mr. Swingler: Considering the nation's resources and the deployment of the ports, I would have thought that the hon. Gentleman would have regarded it as of key importance that the correct decision should be taken about the location of container berths, and about the substantial investment that is taking place. Of course, the hon. Gentleman is not like the hon. Member for Weston-super-Mare (Mr. Webster), who says that the only thing the Minister of Transport is doing is playing about with the question of nationalising our ports.
Let me give the figures for port investment during the last six years. In 1962, capital investment in ports amounted to £17·9 million. In 1963, it was £13·8 million; in 1964, it was £18 million; in 1965, it was £26·5 million; in 1966, it was £35·2 million; and this year it will reach more than £40 million. Just as my right hon. Friend rebutted what the hon. Member for Worcester said about the roads programme, so those figures rebut any idea that my right hon.


Friend has been neglecting investment in the ports. On the contrary, we have made a substantial increase in investment and modernisation in the ports. That is why we regard the question of reorganisation as being of key importance.
But there is another consideration. D-day, for decasualisation in the docks in this country, is now in sight. My right hon. Friend the Minister of Labour has said that provided he is satisfied with the report presented to him by the independent members of the National Modemisarsation Committee he will take the necessary steps to end the casual system of employment in our docks by 15th September. As the House knows, the independent members presented their report to the Minister by 1st July, as promised, and he is considering it urgently. This is a momentous issue on which the Government will be announcing their decision shortly. It marks the culmination of efforts made over many years to introduce a more stable pattern of employment in our docks.
One recalls the first National Docks Registration Scheme introduced by Mr. Ernest Bevin in the wartime Coalition Government and the Dock Workers (Regulation of Employment) Act, 1946, introduced by Mr. George Isaacs and the first Dock Labour Scheme made under it, which is virtually that which is operating today. This scheme was a tremendous advance on the unregulated scramble for work in the docks that had gone on before, but it still provided a pool of casual labour from which most workers were allocated on a daily basis.
There was a growing feeling on all sides that this was not appropriate for the second half of the 20th century. The Devlin Committee was set up by the Minister of Labour in October, 1964. It reported in August, 1965, and it crystallised these ideas into a specific plan for the complete abolition of the casual system in the docks. In essence, its recommendations were that the number of employers should be reduced by a system of licensing and that every registered dock worker should be allocated permanent employment by the operation of a completely revised dock labour scheme.
It is nearly two years since the Devlin Report was published. During that time

negotiations have proceeded in the industry at national level and port by port to turn this plan into a reality. The Docks and Harbours Act, 1966, was put on the Statute Book to provide for the licensing of employers and improved arrangements for supervision of welfare amenities in the docks. The two sides of industry set up the National Modernisation Committee, with Lord Brown as Chairman and three other independent members. One of the many matters with which the Committee was concerned was the pay scheme which was to accompany the introduction of the new system. This was the subject of a further report by a Committee under Lord Devlin's chairmanship in October, 1966. In accepting in principle a number of recommendations made in its Report, the Government made it clear that proposed pay increases were to be conditional on the specific agreement for the elimination of restrictive practices and a recognition of the prices and incomes policy. These are not matters which can be settled by a stroke of the pen. They have been the subject of detailed negotiations between employers and trade unions in the local modernisation committees set up for every port in this country.
It is the independent members' Report on the outcome of these negotiations which is now before the Government. The independent members have said that they are confident that their report confirms that the Government's conditions will be met. If this is so, and the new scheme is introduced in September, as planned, we are confident that the new system will offer dockers greater security to meet the coming technological changes in their industry, which has been such a big part of the subject of this debate, and will also give them the benefit of increased efficiency in the industry.

Mr. Ridley: While the right hon. Gentleman is busy with his Ministry of Labour brief, will he answer my question, whether the Docks Labour Board is to be brought to an end upon nationalisation of the docks industry?

Mr. Swingler: The hon. Member was on the Standing Committee on the Docks and Harbours Bill, and he knows quite well that we had discussions on subjects which formed a large part of the debate today, on the proposed reorganisation of


ports and docks and the very important natters with which I have just been dealing.
We believe that the introduction of a new scheme—

Mr. Ridley: Mr. Ridley rose—

Mr. Swingler: —will offer immediate improvements in the day-to-day running of the ports, speeding the handling of imports and exports and the turn-round of ships and that it will provide stable foundations on which—

Mr. Ridley: Mr. Ridley rose—

Mr. Swingler: —wider reorganisation of the ports under public ownership can be carried through.
Hon. Members who have followed these matters will know that these negotiations and developments for the abandonment of restrictive practices, combined with the higher rate of capital investment in the ports, the figures for which

I have given, and the implications of the container revolution are closely interconnected and make of over-riding importance the implementation of the scheme of public ownership of the ports on which the Government have put forward the working document for consultation.

Mr. Ridley: Mr. Ridley rose—

Mr. McNamara: Mr. McNamara rose—

Mr. Speaker: Order. Before the hon. Gentleman sits down, two hon. Gentlemen wish to ask him a question. He must choose. He chooses neither. It is within his capacity to choose whom he likes and apparently he chooses neither.

Question put,
That this House is opposed to further nationalisation of bus operators, road hauliers and the ports and docks industries, and therefore deplores the Government policies which threaten these industries:—

The House divided: Ayes 239, Noes 306.

Division No. 472.]
AYES
[9.57 p.m.


Alison, Michael (Barkston Ash)
Corfield, F. V.
Hall-Davis, A. G. F.


Allason, James (Hemel Hempstead)
Costain, A. P.
Hamilton, Marquess of (Fermanagh)


Astor, John
Craddock, Sir Beresford (Spelthorne)
Hamilton, Michael (Salisbury)


Atkins, Humphrey (M't'n &amp; M'd'n)
Crawley, Aidan
Harris, Frederic (Croydon, N.W.)


Awdry, Daniel
Crosthwaite-Eyre, Sir Oliver
Harrison, Col. Sir Harwood (Eye)


Baker, W H. K.
Crouch, David
Harvey, Sir Arthur Vere


Balniel, Lord
Crowder, F. P.
Harvie Anderson, Miss


Barber, Rt. Hn. Anthony
Cunningham, Sir Knox
Hastings, Stephen


Batsford, Brian
Currie, G. B H.
Hawkins, Paul


Beamish, Col. Sir Tufton
Dalkeith, Earl of
Hay, John


Bell, Ronald
Dance, James
Heald, Rt. Hn. Sir Lionel


Bennett, Sir Frederic (Torquay)
Davidson, James (Aberdeenshire, W.)
Heath, Rt. Hn. Edward


Bennett, Dr. Reginald (Gos. &amp; Fhm)
d'Avigdor-Goldsmid, Sir Henry
Heseltine, Michael


Berry, Hn. Anthony
Dean, Paul (Somerset, N.)
Higgins, Terence L.


Bessell, Peter
Deedes, Rt. Hn. W. F. (Ashford)
Hiley, Joseph


Biffen, John
Digby, Simon Wingfield
Hill, J. E. B.


Biggs-Davison, John
Dodds-Parker, Douglas
Hirst, Geoffrey


Birch, Rt. Hn. Nigel
Doughty, Charles
Holland, Philip


Black, Sir Cyril
Douglas-Home, Rt. Hn. Sir Alec
Hooson, Emlyn


Blaker, Peter
Drayson, G. B.
Hordern, Peter


Body, Richard
du Cann, Rt. Hn. Edward
Hornby, Richard


Bossom, Sir Clive
Eden, Sir John
Howell, David (Guildford)


Boyd-Carpenter, Rt. Hn. John
Errington, Sir Eric
Hunt, John


Boyle, Rt. Hn. Sir Edward
Eyre, Reginald
Hutchison, Michael Clark


Braine, Bernard
Farr, John
Iremonger, T. L.


Brewis, John
Fisher, Nigel
Irvine, Bryant Godman (Rye)


Brinton, Sir Tatton
Fletcher-Cooke, Charles
Jenkin, Patrick (Woodford)


Bromley-Davenport.Lt. Col. Sir Walter
Fortescue, Tim
Johnson Smith, G. (E. Grinstead)


Brown, Sir Edward (Bath)
Foster, Sir John
Johnston, Russell (Inverness)




Jones, Arthur (Northants, S.)


Bruce-Gardyne, J.
Fraser,Rt.Hn.Hugh(St'fford &amp; Stone)
Jopling, Michael


Bryan, Paul
Galbraith, Hon. T. G.
Joseph, Rt. Hn. Sir Keith


Buchanan-Smith, Alick(Angus,N&amp;M)
Gibson-Watt, David
Kaberry, Sir Donald


Buck, Antony (Colchester)
Giles, Rear-Adm. Morgan
Kershaw, Anthony


Bullus, Sir Eric
Gilmour, Sir John (Fife, E.)
Kimball, Marcus


Burden, F. A.
Glover, Sir Douglas
King, Evelyn (Dorset, S.)


Campbell, Gordon
Glyn, Sir Richard
Kirk, Peter


Carlisle, Mark
Godber, Rt. Hn. J. B.
Kitson, Timothy


Carr, Rt. Hn. Robert
Goodhart, Philip
Knight, Mrs. Jill


Cary, Sir Robert
Goodhew, Victor
Lambton, Viscount


Channon, H. P. G.
Gower, Raymond
Lancaster, Col. C. C.


Clark, Henry
Grant, Anthony
Legge-Bourke, Sir Harry


Clegg, Walter
Grant-Ferris, R.
Lewis, Kenneth (Rutland)


Cooke, Robert
Grieve, Percy
Lloyd, Rt.Hn. Geoffrey (Sut'nC'dfield)


Cooper-Key, Sir Neill
Gurden, Harold
Lloyd, Ian (P'tsm'th, Langstone)


Cordle, John
Hall, John (Wycombe)
Lloyd, Rt. Hn. Selwyn (Wirral)




Longden, Gilbert
Osborn, John (Hallam)
Stoddart-Scott, Col. Sir M. (Ripon)


Loveys, W. H.
Osborne, Sir Cyril (Louth)
Summers, Sir Spencer


Lubbock, Eric
Page, Graham (Crosby)
Tapsell, Peter


McAdden, Sir Stephen
Page, John (Harrow, w.)
Taylor, Sir Charles (Eastbourne)


MacArthur, Ian
Pardoe, John
Taylor,Edward M.(G'gow,Cathcart)


Maclean, Sir Fitzroy
Pearson, Sir Frank (Clitheroe)
Taylor, Frank (Moss Side)


Macleod, Rt. Hn. Iain
Peel, John
Teeling, Sir William


McMaster, Stanley
Percival, Ian
Temple, John M.


Macmillan, Maurice (Farnham)
Peyton, John
Thatcher, Mrs. Margaret


Maddan, Martin
Pike, Miss Mervyn
Thorpe, Rt. Hn. Jeremy


Maginnis, John E.
Pink, R. Bonner
Tilney, John


Marples, Rt. Hn. Ernest
Pounder, Rafton
Turton, Rt. Hn. R. H.


Marten, Neil
Powell, Rt. Hn. J. Enoch
van Straubenzee, W. R.


Maude, Angus
Prior, J. M. L.
Vaughan-Morgan, Rt. Hn. Sir John


Maudlins, Rt. Hn. Reginald
Pym, Francia
Vickers, Dame Joan


Mawby, Ray
Quennell, Miss J. M.
Walker, Peter (Worcester)


Maxwell-Hyslop, R. J.
Ramsden Rt. Hn. James
Walker-Smith, Rt. Hn. Sir Derek


Maydon, Lt. Cmdr. S. L. C.
Rawlinson, Rt. Hn. Sir Peter
Wall, Patrick


Mills, Peter (Torrington)
Rees Davies, W. R.
Ward, Dame Irene


Mills, Stratton (Belfast, N.)
Renton, Rt. Hn. Sir David
Weatherill, Bernard


Miscampbell, Norman
Ridley, Hn. Nicholas
Webster, David


Mitchell, David (Basingstoke)
Ridadale, Julian
Wells, John (Maidstone)


Monro, Hector
Robson Brown, Sir William
Whitelaw, Rt. Hn. William


Montgomery, Fergus
Rodgers, Sir John (Sevenoaks)
Wills, Sir Gerald (Bridgwater)


Morgan, Geraint (Denbigh)
Rossi, Hugh (Hornsey)
Wilson, Geoffrey (Truro)


Morrison, Charles (Devizes)
Royle, Anthony
Winstanley, Dr. M. P.


Mott-Radclyffe, Sir Charles
Russell, Sir Ronald
Wolrige-Gordon, Patrick


Munro-Lucas-Tooth, Sir Hugh
Scott, Nicholas
Wood, Rt. Hn. Richard


Murton, Oscar
Sharples, Richard
Woodnutt, Mark


Nabarro, Sir Gerald
Shaw, Michael (Sc'b'gh &amp; Whitby)
Worsley, Marcus


Neave, Airey
Sinclair, Sir George
Wylie, N. R.


Nicholls, Sir Harmar
Smith, John
Younger, Hn. George


Nott, John




Onslow, Cranley
Stainton, Keith



Orr, Capt. L. P. S.
Steel, David (Roxburgh)
TELLERS FOR THE AYES:


Orr-Ewing, Sir Ian
Stodart, Anthony
Mr. R. W. Elliott and




Mr. Jasper More.




NOES


Abse, Leo
Cant, R. B.
Evans, Ioan L. (Birm'h'm, Vardley)


Allaun, Frank (Saltord, E.)
Carmichael, Neil
Faulds, Andrew


Alldritt, Walter
Carter-Jones, Lewis
Fernyhough, E.


Allen, Scholefield
Castle, Rt. Hn. Barbara
Finch, Harold


Anderson, Donald
Coe, Denis
Fitch, Alan (Wigan)


Archer, Peter
Coleman, Donald
Fletcher, Raymond (Ilkeston)


Armstrong, Ernest
Concannon, J. D.
Fletcher, Ted (Darlington)


Ashley, Jack
Conlan, Bernard
Foley, Maurice


Atkins, Ronald (Preston, N.)
Craddock, Ceorge (Bradford, S.)
Foot, Sir Dingle (Ipswich)


Atkinson, Norman (Tottenham)
Cronin, John
Foot, Michael (Ebbw Vale)


Bacon, Rt. Hn. Alice
Crosland, Rt. Hn. Anthony
Ford, Ben


Bagier, Gordon A. T.
Crossman, Rt. Hn. Richard
Forrester, John


Barnes, Michael
Cullen, Mrs. Alice
Fowler, Gerry


Barnett, Joel
Darling, Rt. Hn. George
Fraser, John (Norwood)


Baxter, William
Davidson, Arthur (Accrington)
Freeson, Reginald


Beaney, Alan
Davies, Dr. Ernest (Stretford)
Gardner, Tony


Bellenger, Rt. Hn. F. J.
Davies, G. Elfed (Rhondda, E.)
Ginsburg, David


Bence, Cyril
Davies, Harold (Leek)
Gordon Walker, Rt. Hn. P. C.


Benn, Rt. Hn. Anthony Wedgwood
Davies, Ifor (Gower)
Gourlay, Harry


Bennett, James (G'gow, Bridgeton)
Davies, S. O. (Merthyr)
Gray, Dr. Hugh (Yarmouth)


Bidwell, Sydney
de Freitas, Rt. Hn. Sir Geoffrey
Gregory, Arnold


Binns, John
Dell, Edmund
Grey, Charles (Durham)


Bishop, E. S.
Dempsey, James
Griffiths, Will (Exchange)


Blackburn, F.
Dewar, Donald
Gunter, Rt. Hn. R. J.


Blenkinsop, Arthur
Diamond, Rt. Hn. John
Hamilton, James (Bothwell)


Boardman, H.
Dickens, James
Ifamilton, William (Fife, W.)


Booth, Albert
Dobson, Ray
Hamling, William


Boston, Terence
Doig, Peter
Harrison, Walter (Wakefield)


Bottomley, Rt. Hn. Arthur
Donnelly, Desmond
Hart, Mrs. Judith


Bowden, Rt. Hn. Herbert
Driberg, Tom
Haseldine, Norman


Boyden, James
Dunn, James A.
Hattersley, Roy



Dunnett, Jack
Hazell, Bert


Braddock, Mrs. E. M.
Dunwoody, Mrs. Gwyneth (Exeter)
Heffer, Eric S.


Bradley, Tom
Dunwoody, Dr. John (F'th &amp; C'b'e)
Henig, Stanley


Bray, Dr. Jeremy
Eadie, Alex
Herbison, Rt. Hn. Margaret


Brooks, Edwin
Edelman, Maurice
Hilton, W. S.


Broughton, Dr. A. D. D.
Edwards, Rt. Hn. Ness (Caerphilly)
Hobden, Dennis (Brighton, K'town)


Brown, Rt. Hn. George (Belper)
Edwards, Robert (Bileton)
Hooley, Frank


Brown, Hugh D. (G'gow, Provan)
Edwards, William (Merioneth)
Horner, John


Brown, Bob(N'c'tle-upon-Tyne,W.)
Ellis, John
Houghton, Rt. Hn, Douglas


Brown, R. W. (Shoreditch &amp; F'bury)
English, Michael
Howarth, Harry (Wellingborough)


Buchan, Norman
Ennals, David
Howarth, Robert (Bolton, E.)


Buchanan, Richard (G'gow, Sp'burn)
Ensor, David
Howell, Denis (Small Heath)


Butler, Herbert (Hackney, C.)
Evans, Albert (Islington, S.W.)
Howie, W.


Callaghan, Rt. Hn. James
Evans, Gwynior (C'marthen)
Hoy, James







Huckfield, L.
Mayhew, Christopher
Rowland, Christopher (Meriden)


Hughes, Rt. Hn. Cledwyn (Anglesey)
Mellish, Robert
Rowlands, E. (Cardiff, N.)


Hughes, Emrys (Ayrshire, S.)
Mendelson, J. J.
Ryan, John


Hughes, Hector (Aberdeen, N.)
Mikardo, Ian
Shaw, Arnold (Ilford, S.)


Hughes, Roy (Newport)
Millan, Bruce
Sheldon, Robert


Hunter, Adam
Milne, Edward (Blyth)
Shinwell, Rt. Hn. E.


Hytid, John
Mitchell, R. C. (s'th'pton, Test)
Short, Rt. Hn. Edward (N'c'tle-u-Tyne)


Irvine, A. J. (Edge Hill)
Molloy, William
Short, Mrs. Renee(W'hampton, N.E.)


Jackson, Colin (B'h'se &amp; Spenb'gh)
Morris, Alfred (Wythenshawe)
Silkin, Rt. Hn. John (Deptford)


Jay, Rt. Hn. Douglas
Morris, Charles R. (Openshaw)
Silkin, Hn. S. C. (Dulwich)


Jeger, Mrs. Lena (H'b'n&amp;St.P'cras, S.)
Morris, John (Aberavon)
Silverman, Julius (Aston)


Jenkins, Hugh (Putney)
Moyle, Roland
Skeffington, Arthur


Jenkins, Rt. Hn. Roy (Stechford)
Murray, Albert
Slater, Joseph


Johnson, Carol (Lewisham, S.)
Newens, Stan
Small, William


Jones, Dan (Bumley)
Noel-Baker, Francis (Swindon)
Snow, Julian


Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)
Noel-Baker, Rt. Hn. Philip (Derby, S.)
Spriggs, Leslie


Jones, J. Idwal (Wrexham)
Norwood, Christopher
Steele, Thomas (Dunbartonshire, W.)


Jones, T. Alec (Rhondda, West)
Oakes, Gordon
Stewart, Rt. Hn. Michael


Judd, Frank
Ogden, Eric
Stonehouse, John


Kelley, Richard
O'Malley, Brian
Strauss, Rt. Hn. G. R.


Kerr, Mrs. Anne (R'tet &amp; Chatham)
Orbach, Maurice
Summerskill, Hn. Dr. Shirley


Kerr, Dr, David (W'worth, Central)
Orme, Stanley
Swain, Thomas


Kerr, Russell (Feitham)
Oswald, Thomas
Swingler, Stephen


Lawson, George
Owen, Dr. David (Plymouth, S'tn)
Symonds, J. B.


Leadbitter, Ted
Owen, Will) (Morpeth)
Taverns, Dick


Ledger, Ron
Padley, Walter
Thornton, Ernest


Lee, Rt. Hn. Frederick (Newton)
Page, Derek (King's Lynn)
Tinn, James


Lee, Rt. Hn. Jennie (Cannock)
Palmer, Arthur
Tomney, Frank


Lee, John (Reading)
Pannell, Rt. Hn. Charles
Tuck, Raphael


Lestor, Miss Joan
Park, Trevor
Urwin, T. W.


Lever, Harold (Cheetham)
Parker, John (Dagenham)
Varley, Eric G.


Lewis, Arthur (W. Ham, N.)
Parkyn, Brian (Bedford)
Walden, Brian (All Saints)


Lewis, Ron (Carlisle)
Pavitt, Laurence
Walker, Harold (Doncaster)


Lipton, Marcus
Pearson, Arthur (Pontypridd)
Watkins, David (Consett)


Lomas, Kenneth
Pentland, Norman
Watkins, Tudor (Brecon &amp; Radnor)


Loughlin, Charles
Perry, Ernest G. (Battersea, S.)
Weitzman, David


Luard, Evan
Perry, George H. (Nottingham, s.)
Wellbeloved, James


Lyon, Alexander W. (York)
Prentice, Rt. Hn. R. E.
Wells, William (Walsall, N.)


Mabon, Dr. J. Dickson
Price, Christopher (Perry Barr)
Whitaker, Ben


McCann, John
Price, Thomas (Westhoughton)
White, Mrs. Eirene


MacColl, James
Price, William (Rugby)
Whitlock, William


MacDermot, Niall
Probert, Arthur
Wigg, Rt. Hn. George


McGuire, Michael
Pursey, Cmdr. Harry
Willey, Rt. Hn. Frederick


McKay, Mrs. Margaret
Randall, Harry
Williams, Alan (Swansea, w.)


Mackenzie, Gregor (Rutherglen)
Rankin, John
Williams, Alan Lee (Hornchurch)


Mackie, John
Rees, Mertyn
Williams, Clifford (Abertillery)


Maclennan, Robert
Reynolds, G. W.
Williams, Mrs. Shirley (Hitchin)


MacMillan, Malcolm (Western Isles)
Rhodes, Geoffrey
Willis, George (Edinburgh, E.)


McMillan, Tom (Glasgow, C.)
Richard, Ivor
Wilson, William (Coventry, S.)


McNamara, J. Kevin
Roberts, Albert (Normanton)
Winnick, David


MacPherson, Malcolm
Roberts, Goronwy (Caernarvon)
Winterbottom, R. E.


Mahon, Peter (Preston, S.)
Roberts, Gwilym (Bedfordshire, S.)
Woodburn, Rt. Hn. A.


Mallalieu, E. L. (Brigg)
Robertson, John (Paisley)
Woof, Robert


Manuel, Archie
Robnieon, Rt. Hn. Kenneth (St.P'c'as)
Wyatt, Woodrow


Mapp, Charles
Robinson, W. O. J. (Walth'stow, E.)
Yates, Victor


Marquand, David
Rodgers, William (Stockton)



Marsh, Rt. Hn. Richard
Rogers, George (Kensington, N.)
TELLERS FOR THE NOES:


Mason, Roy
Rose, Paul
Mr. Joseph Harper and


Maxwell, Robert

Mr. Neil McBride.

BUSINESS OF THE HOUSE

Ordered,


That the proceedings on the Road Traffic Regulation Bill [Lords] may be entered upon and proceeded with at this day's Sitting al any hour, though opposed.—[Mr. Crossman.]

ROAD TRAFFIC REGULATION BILL [Lords]

Order for Second Reading read.

Motion made, and Question proposed, That the Bill be now read a Second time.

10.10 p.m.

Mr. Graham Page: The Schedules to the Bill show how scattered is the law in connection with Road Traffic Regulations; and that it was a wise choice not only to consolidate the law in this respect but to deal with it as a memorandum case under the Consolidation of Enactments (Procedure) Act of 1949 so that minor corrections and minor improvements might be made in the law before the Bill came to this House on Second Reading. The Bill therefore comes here from the Joint Committee shorn of a number of ambiguities in the law and in a tidy state. But it is difficult to draw the line between Road Traffic Regulations and Road Vehicle Regulations.
This is a consolidation of a small part of the law, and the right hon. and learned Solicitor-General owes it to the House to explain why it is expedient that there should be consolidation of this part of the law on road traffic, and this part only. For example, in the Road Traffic Act, 1960, there is a part entitled
Construction and Use of Vehicles and Equipment
and Section 64 of that Act provides for the
Regulation of construction, weight, equipment and use of vehicles.
Yet in this Bill there is no mention at all of that part of the 1960 Act, although in Clause 112 provision is made for the type of vehicle used on the road.
It therefore seems to be something of an artificial distinction between Road Traffic Regulations and Road Vehicle Regulations when we find that the regulation-making power under Section 64 of the 1960 Act—and, indeed, Section 69, which deals with trailers on the road—does not appear in consolidation. Yet we have such Clauses in this Bill as Clause 15 which deals with the use of public service vehicles on the road.
Again, the Road Safety Act, 1967, which only receives very small mention

here, makes some substantial extensions in the regulation—making powers and might well have been included in the consolidation—

Mr. Speaker: Order. The hon. Gentleman, who is a very old friend of mine in these particular debates, may debate whether these particular Acts may be consolidated or left as separate Statutes. What he cannot do in this debate is to argue that some other Statutes than these ought to be consolidated in this Bill.

Mr. Page: With respect, Mr. Speaker, I apprehend that I am in order in asking the right hon. and learned Gentleman to explain why it is expedient at the present time to make this consolidation. I call attention to a Bill which is passing through Parliament at present, the Civic Amenities Bill, which contains provisions altering provisions within this Consolidated Bill. If that Civic Amenities Bill, which alters completely Clause 20 of the Bill now before us, receives the Royal Assent before the Bill we are now considering, there will be considerable confusion in the law. I ask for an explanation why at this point of time when there will be conflict between two Bills going through the House it is expedient to consolidate the law relating to Road Traffic Regulations, only a small part of the law on road traffic, and likely to cause confusion when in fact it is only a small part of the law.

The Solicitor-General (Sir Dingle Foot): If I may speak again with the leave of the House, I willingly reply to the questions put to me by the hon. Member for Crosby (Mr. Graham Page). It is perfectly true that this Bill does not deal with the whole of road traffic law. As he and the House know, we have a large number of Acts of Parliament relating to road traffic. Those Acts are constantly being amended and added to. Of course, it is desirable that we should consolidate the law in this as in other respects, I am sure the hon. Member would agree. But I assure him that this is only the first of a series of consolidation Bills which together will cover the whole subject of road traffic.
This is part of the process of law reform which the House and the country have come to expect from a wise and beneficent Administration.

Mr. Graham Page: Will the right hon. and learned Gentleman answer the point about the Civic Amenities Bill and Clause 20 of the present Bill which deals with the removal of vehicles illegally, obstructively or dangerously parked, abandoned or broken down, which is dealt with in another place in the Civic Amenities Bill at present?

The Solicitor-General: The answer, I should have thought, is perfectly obvious.

If that Bill is being dealt with in another place at present it cannot be included in a Bill here. [Interruption.]

Mr. Speaker: Order. No heat on these very contentious questions.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Committee of the whole House.—[Mr. McBride.]

Committee Tomorrow.

COAL INDUSTRY (BORROWING POWERS)

The Minister of Power (Mr. Richard Marsh): The Minister of Power (Mr. Richard Marsh) rose—

Mr. John Peyton: On a point of order.
I rise to ask, Mr. Speaker, whether there are any circumstances under which you would be disposed to accept a Motion for the Adjournment of the House.
I ask on these grounds. We are led to believe that an important statement—some may think it overdue—on fuel policy is to be made by the Minister of Power. The benches opposite, as you will observe, are filled by hon. Members representing mining constituencies. They have important points to make on behalf of their constituents—a rare opportunity for them.
The Leader of the House has knowingly and unnecessarily inflicted upon you, upon the staff of the House and upon many hon. Members the virtual certainty of an all-night sitting. I wonder whether there is any limit to the conduct of the right hon. Gentleman. I said the other day that his brutal incursions—

Mr. Speaker: Order. The hon. Member must address me briefly on this point of order.

Mr. Peyton: I shall be very brief.
The right hon. Gentleman's incursions into the affairs of the House of Commons have been more brutal than anything that has happened since the Goths and Vandals raided the Senate of Rome. I ask you whether this is not a gross abuse of the procedure of the House on a very important issue.

Sir Gerald Nabarro: Further to that point of order.

Mr. Speaker: Order. I have been addressed on a point of order. I am sure that the last thing that any hon. Member would wish to do is to inveigle Mr. Speaker into pronouncements which would support one side of the House or the other. The Order Paper has been

arranged. Mr. Speaker will follow the Order Paper. Mr. Marsh.

Sir G. Nabarro: On a point of order.

Mr. E. Shinwell: On a point of order.

Mr. Speaker: Mr. Shinwell.

Mr. Shinwell: On a point of order, Sir.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Order. I can be addressed on a point of order by only one right hon. or hon. Member at any one time. Mr. Shinwell.

Mr. Shinwell: The point of order I wish to raise with you, Sir, is of a rather different kind. It has been stated today—it may be regarded merely as a rumour—that on the Order which is about to be discussed, which may affect the whole future of the coal industry, it is not your intention to allow a wide-ranging debate and that right hon. and hon. Members are to be confined to very narrow limits in the debate.
As, in a few days' time, the House will go into recess, and as we have been promised for some considerable time a statement on the Government's fuel policy, I would like to know, Sir, whether, if we are to remain here during the night to debate the Order, you will allow latitude to hon. Members.

Mr. Speaker: This is probably the first time in history when Mr. Speaker has been asked about rumours as to the way in which he will conduct a debate. I assure the right hon. Gentleman that I will conduct the debate according to the rules of order. How far the latitude will extend is a matter I will have to decide from time to time. There is a limit to latitude as to longitude. Sir Gerald Nabarro.

Sir G. Nabarro: I am grateful to you, Mr. Speaker, I rose on a point of order at the same moment as my hon. Friend the Member for Yeovil (Mr. Peyton) and the right hon. Member for Easington (Mr. Shinwell). During the last few years, ever since nationalisation 20 years ago, we have regularly debated financial borrowing powers Orders. It has always been the ruling of the Chair that only the


finances of the nationalised industry concerned may be debated within the compass of the Order under discussion.
I seek your guidance, Sir, because this is not a matter of rumour. For weeks past my hon. Friends and myself have been pressing the Minister of Power and the Leader of the House to tell us when the fuel and power policy statement would be made. We are now told that it is to be made this evening, within the confines of the Order.

Mr. Peyton: Surely not.

Sir G. Nabarro: Manifestly, it will be impossible for any hon. Member, myself included, to remain in order if a general fuel and power policy statement is made at the outset of the debate within the narrow confines of the Order. I repeat that they are very narrow. They have been ruled to be exceedingly narrow by every occupant of the Chair since nationalisation in 1946. I repeat that, manifestly, it will be impossible for hon. Members to debate the Order without straying outside the grounds of order if, at the beginning of the debate, there is to be the promised fuel and power policy statement.
Accordingly, Sir, will it be in order for me to raise further points of order during the speech of the Minister asking for guidance as to the way in which his statement relates itself to the very narrow Order before the House tonight?

Mr. Speaker: Obviously, it would be in order for the hon. Gentleman to raise points of order at any moment. I understand that what he was trying to argue was that he would circumscribe the Chair when it came to statements made by the Minister who is introducing the Order so that he might circumscribe himself and prevent himself from raising any points of wider application than he thought were necessary during the course of the debate.
I think that the House might let the Chair conduct the debate. We are on an Order which is to be moved by the Minister. If the Minister goes out of order, the Chair will call him to order. If the hon. Member for Worcestershire, South (Sir G. Nabarro) goes out of order, the Chair will call him to order. This is the function of the Chair. Mr. Marsh.

10.25 p.m.

The Minister of Power (Mr. Richard Marsh): I beg to move,
That the Coal Industry (Borrowing Powers) Order 1967, a draft of which was laid before this House on 26th June, be approved.
This Order increases the limit of borrowing for the coal industry to the £750 million maximum, as provided in the 1965 Act. It was estimated when that Act was passed that total borrowings would increase to about £750 million by March, 1971, but events since then have led to an increase in borrowing which makes this Order necessary. Indeed, this is not a routine Order. It is the result of pressures and changes which have emerged in relation to the coal mining industry.
I know that some of my right hon. and hon. Friends are very concerned indeed about the present position of the coal mining industry, and I am very glad to have this opportunity, on this Order, quite properly of commenting on the situation which gives rise to the need for this extension in the borrowing powers. This is a borrowing powers Order. It is about an additional £50 million borrowing capacity. It is not a debate, none the less, for shrivelled bookkeepers. It is an Order the implications of which affect the hopes and aspirations of hundreds and thousands of men and the futures of entire mining communities.
I intend to present a White Paper on Fuel Policy in the autumn, and there will be an opportunity for further discussion then. But to put this debate in context, and to explain why we need this particular borrowing power, it is essential to refer to some of the conclusions which have emerged from the Fuel Policy Review. The problem arises basically because we are moving from a two to a four fuel economy. We need to use all four of them to the best advantage of the nation as a whole.
This means taking account of the real cost to the economy of the different possible options open to us, choosing the pattern which will give us the cheapest fuel supplies in terms of real costs, security of supply, technical advance, social considerations and the balance of payments. These are factors which very much concern the coal mining industry,


and this Order and the need for this additional borrowing are crucial to this problem.
Coal is not an industry which is standing still. The future of this industry, despite the present financial and physical difficulties, will see further technological developments which will take the industry further along the road towards being the highly capitalised, streamlined industry needed in this modern age. Of course, physically there is plenty of fuel of all types available, and there is no reason to doubt that this will be so for the foreseeable future. The question is not, therefore, whether Britain's energy needs can be met; the question is how we meet them, and the rôle which the coal mining industry plays in this context.
North Sea gas and nuclear power, like coal, are secure in the sense that their availability in peace-time is not liable to be affected by action taken in other countries. Supplies of oil, like those of most other advanced industrial countries, as hon. Members will have noticed, run the risk of interruption from time to time. None the less, we have to use oil for many purposes. It is very useful for others, and we have to strike a balance between these needs and the risk of interruption. The basic point here is that oil is not scarce. There is more than enough to meet our needs.
It is frequently and fairly argued that there are no direct foreign exchange costs associated with coal, but there must be a limit to the costs that it is sensible to incur to protect coal on balance of payments grounds, and for the longer term it may be that something less than the present degree of protection is justified.
Our balance of payments position can suffer, also, if our energy costs make exports too expensive to sell. We used to have an advantage compared with our major competitors in Western Europe. This has been lost. The arrival of natural gas and nuclear power gives us a good chance to secure the right balance in our policy measures while at the same time getting energy at lower costs.
The North Sea, for example, is capable of providing as much as 2,000 million cu. ft. of gas a day by 1970 or soon after, rising to about 3,000 million c.f.d. within

a few years of that. Our policy is to aim for a rapid build-up in absorption. This will keep down energy costs and, to the extent that gas is used rather than oil, save foreign exchange. We shall be using this gas in four ways: in reforming plants to make town gas; by conversion of whole areas to accept the supply of natural gas; in the supply of gas to premium industrial users and in supply—this is of particular interest to the coal mining industry—to bulk industrial consumers.
The advantage of the use of natural gas as a premium fuel is clear. In the bulk industrial market, the potential savings are lower, and some coal as well as oil would be likely to be displaced. But, to get this rapid build-up, the gas industry has to penetrate this market to some extent, though by far the greater part of the natural gas will go to the premium market rather than the bulk industrial market. The timing of the build-up is difficult to forecast precisely, but we expect it by 1971 to be supplying about one-twelfth of our total energy needs, and by the middle of the decade we should have doubled this.
The other problem affecting the coal mining industry, the other factor which has caused us to look at the finances of the coal mining industry, is the second new source of energy, nuclear power. I shall spend very little time on it, but it is essential to mention it because it is such a big factor so far as coal is concerned. Britain leads the field with nuclear power, and, of course, it has been more costly than an equivalent amount of conventional generation. But the first programme is now nearly complete, and it would be economic madness to lose the lead for which we have paid so highly so far. It is worth noting that Sizewell, for instance, is competitive with the expected generation costs at comparable coal-fired stations such as Tilbury B, due to be commissioned this year.
The A.G.R. makes nuclear power fully competitive with the best conventional power stations. Taking cautious assumptions as to life and load factors, A.G.R. stations now building under the second nuclear programme to come into service in the 1970s will generate more cheaply than the best contemporary coal-fired station now being built. The payoff from advances in nuclear technology


will not stop there. There is every prospect of further cost reductions from the A.G.R., and further ahead there lies the promise of the fast breeder reactor.
It is well known that the Coal Board, which is very much affected by this argument, has raised the question of the famous 0·56d. per unit which has been quoted—out of context, I must say—as the current estimate of the generating costs of Dungeness B. That figure comes from a confidential report and was arrived at by including all the most pessimistic assumptions solely for the purpose of comparison with longer-term estimates.

Sir G. Nabarro: Will the right hon. Gentleman—

Mr. Marsh: Will the hon. Gentleman let me complete this argument? Many hon. Members on both sides want to speak, and I should like to develop this point, if the hon. Gentleman will forgive me.
On current C.E.G.B. ground rules, which some people regard as too cautious, the estimated cost of Dungeness B is 0·525d. per unit, and that includes a royalty figure of 0£014d. per unit.
In view of the confusion which has been created over the issue, I have decided to present this report in total, together with my observations, to the Select Committee on Science and Technology.
I make this further point on the question of nuclear costs as compared with the costs of coal generation, which, of course, is crucial to the argument. I have consulted the A.E.A., the C.E.G.B. and the Ministry's Chief Scientist's Division. The advice from these three totally different angles was unanimous. Obviously, they could all be wrong—[An HON. MEMBER: "Hear, hear"] This is a possibility. I put it no higher. If they are wrong, so are the nuclear scientists of every industrial nation in the world which is at present looking at nuclear generation. It is possible that they are all wrong. As a non-technical Minister, I can only say that in my judgment this seems highly unlikely.

Mr. Michael McGuire: I am grateful to my right hon. Friend for giving way. I would not rely too much on

the inference he is making of the scientists' infallibility, because they were proved wrong 10 years ago.

Mr. Marsh: I agree with my hon. Friend that one cannot regard any group of people—

Mr. McGuire: They were proved to be very wrong.

Mr. Marsh: I understand my hon. Friend's point. I am not suggesting that they are infallible. [Interruption.] Let me answer the question, because that makes the debate easier to understand. My hon. Friend's point is that 10 years ago the first Magnox programme was very expensive. It is not without significance that the people who challenged it were the C.E.G.B.'s nuclear scientists.
If the critics of the figure are right, all the nuclear scientists of the C.E.G.B. are wrong, the nuclear scientists of the Ministry of Power are wrong, and nuclear scientists in other countries and concerned with other power stations are also wrong. This is a possibility, but it is unlikely.

Sir G. Nabarro: To underline the possibility, the point I want the Minister to deal with now is the fact that Lord Robens, who occupies a powerful position as Chairman of the National Coal Board, told the annual conference of the National Union of Mineworkers at East-bourne on 6th July, and then wrote in the Financial Times of Thursday, 13th July, that the nuclear scientists were wrong and that he, Lord Robens, and the coal-mining hon. Members opposite, including particularly the right hon. Member for Easington (Mr. Shinwell), were right. Therefore, we have some reason to doubt the conclusion of the Minister. I prefer Lord Robens to the Minister.

Mr. Marsh: The hon. Gentleman would not expect me to pass comment on his particular choice. But I think that in this correspondence the hon. Member for Orpington (Mr. Lubbock) is now locked in literary battle with the Chairman of the National Coal Board, and it would not be for me to intervene.
Any forward estimating necessarily entails judgments, but the broad prospects are beyond all reasonable dispute in this. To get coal into perspective, it is worth


remembering that about 20,000 megawatts of coal-fired plant are under construction at the moment. We are talking as if we are winding up the coal industry, but that plant, which is under construction as of now, will be with us for another 30 years.
By 1975, the first and second nuclear power programmes together will amount to less than one-sixth of our total generating capacity. This should be kept in comparison. That is a relatively small proportion of the market and gives us a chance to take advantage of any especially favourable opportunities for coal which may arise.
Therefore, at the beginning of the 1970s nulear power and natural gas may together account for nearly one-eighth of our total needs, and by the mid-1970s as much as a quarter. Much of this will be taken up by the natural growth in energy demand, but there is clearly bound to be an effect on coal and oil if there are four sources of energy instead of two.
Coal and oil now meet 96 per cent. of our needs. There will probably be some slackening in the very rapid growth of recent years in the use of oil, but sectors where it is irreplaceable, such as transport and petrochemicals will continue to grow. Even allowing for the foreign exchange element, oil is cheap in real terms. The evidence is that even with a fuel oil tax of about 40 per cent., it can still compete with other fuels. [An HON. MEMBER: "If we can get it."] We are getting it, as can be seen.
The main issue, and the crucial industry, is coal. Despite great efforts, the industry is in difficulties. It must be remembered that in examining the outlook for coal we are not just looking at the prospects of an industry.
I return to the point that we are discussing, the futures and lives of entire communities.
Coal faces tremendous competitive pressures. It is sometimes said that we should distort the market. Of course we should. But, of course, we have rightly and deliberately distorted the market forces in favour of coal, but still it has lost ground year by year. There is a fuel oil tax of about 40 per cent., a total ban on all foreign imports of coal and

very considerable discrimination against oil at power stations. These and other measures are intended to push up coal demand, but despite them it has continued to lose ground.
The one point that I want to make in this debate which I think is essential is that it is not that the Government are considering how they can increase the rundown in the coal mining industry. The sole problem is how to slow down the rundown in the industry.

Mr. McGuire: Mr. McGuire rose—

Mr. Marsh: I am sure that a great many hon. Gentlemen want to speak in the debate, and if I get my speech over quickly they will have more chance of making their own.
The point that I am making is that, despite this rundown—and what we are trying to do is to slow down the rundown; we are certainly not trying to produce it—a decline in the market for coal is quite inevitable even with the continuation of all the present measures of protection. We cannot afford to deny ourselves the advantage of the cheap new fuels. To pay our way we have to export about one-fifth of the national output and our industries must have access to a cheap energy policy.
In 1966, the consumption and export of coal fell by 11 million tons, and in April, May and June of this year we were down to 163 million tons. Almost every main consumer group has been buying less and less coal. It is not an argument about the production of coal. It is an argument about the ability or otherwise to sell coal. It is not the experience of this country alone. It is the experience of the French, the Germans, the Belgians and the Dutch, who have all got similar problems, and some of them have even bigger difficulties than we have.

Mr. Shinwell: I am following with the greatest attention what my right hon. Friend is saying in his most interesting analysis. But what I am asking myself—and perhaps he can provide me with the answer because I cannot find it myself—is: if this is the position, what is he borrowing more money for?

Mr. Marsh: I will come to that. We are borrowing more money because one of the direct results of this is increased


stocking as a result of the inability to sell the coal which is being produced, which will be running by the end of this year at a level of about 30 million tons. As my right hon. Friend knows very well, better than anybody else in the House probably, stocking coal in these figures is a highly expensive proposition. This is why the debate is directly relevant to this borrowing powers Order. I shall come on to that in a moment.

Mr. John Cronin: Can my right hon. Friend explain why it is that in the United States and the Soviet Union a big increase in coal production is taking place?

Mr. Marsh: Yes, very simply. It is contained in the reason why we have a complete ban on American imports of coal into this country. American coal is very much cheaper than British coal. This has nothing to do with the men. It was once said by Lord Robens that the Americans do not mine coal; they quarry it. There is a great deal of truth in that. It is certainly very cheap coal.
It should be said that the total growth in demand for fuel seems likely to be slower during the next three or four years than in the recent past, partly because of the increased efficiency with which fuels like natural gas can be burnt and because of expected increases in the efficiency of generation at power stations.
The prospect is, therefore, one of increasing competition from other fuels and, for a few years only, a limited rise in fuel requirements. From supplying nearly a 60 per cent. of total energy last year, coal, given the further support I am proposing, may provide about half of our energy needs by 1970. This half is a significant proportion for one out of four fuels. Coal will remain of great importance for as far ahead as we can see and it is vital to increase productivity in the industry so that it can produce at a lower real cost.
We want as much coal as can be economically produced. But in taking steps to increase efficiency of the industry we have to maintain confidence and morale, otherwise is could become incapable of contributing economically to our fuel requirements. My hon. Friends from mining areas will be aware of that.
The Coal Board believes that by 1970 productivity can be up by one-third from its 1966 level of 36·4 cwt. per manshift and in the 1970s they look to even greater increases. With the exploitation of new techniques being developed at colleries like Bevercotes, the Board looks to even greater advances. It is essential in the interests of the industry that we get this improved efficiency.
The first results of the review suggested a total market for coal in 1970 on present trends and this was a completely dispassionate appraisal—of something over 140 million tons. Further examination suggested that it might be higher, but, nevertheless, it remained, in my view, too low on both social and economic grounds. I am, therefore, proposing further support for coal, though limited in amount and in kind.
For over two years the electricity industry has been giving substantial temporary assistance to the coal industry by burning coal in parts of the system when it would have been cheaper for it to burn oil. The cost of this assistance has been borne by the consumers of electricity. As the fortunes of the electricity and coal industries have been linked in coal-fired power stations, this was not an unreasonable temporary arrangement. Now, however, I think that this support may need to be increased and I have asked the electricity industry, with possibly some support from the gas industry, to consume up to 6 million tons more coal a year in the period ending March, 1971. The aim of the support would be to try to hold the demand for coal by 1970 at around 155 million tons.
It is not reasonable for the burden of short-term assistance to coal to fall solely on consumers of electricity or gas. We have, therefore, decided to ask Parliament to provide for the cost to be met out of public funds. Details of the precise arrangements will be given when the necessary Bill is introduced next Session.
The proposal will also help in dealing with the immediate problem of rising coal stocks caused by the continued fall in demand. Undistributed stocks have risen by 7 million tons during the last six months and are expected to rise by several million tons more by the end of the year to about 30 million.
I now turn to the economic, social and human consequences of the steep decline in the industry's manpower requirements.

Mr. Eric Lubbock: Can the Minister say how much coal he expects to be consumed in power stations in 1970, so that we can compare this with the energy policy White Paper?

Mr. Marsh: That may well be stretching the patience of Mr. Deputy Speaker a little too far.

Sir G. Nabarro: Why?

Mr. Marsh: If the hon. Member will stop saying "Why" it will enable me to answer the question, and he might then stop saying "Why". The hon. Member for Orpington referred to the White Paper. What I am dealing with is the specific factors which arise out of this Order. If I were to go into the entire fuel policy it might take longer.

Sir G. Nabarro: What the right hon. Gentleman is proposing is a direct subsidy on electricity tariffs for the general range of industrial and domestic consumers. That is the proper definition. How much will it cost the taxpayer?

Mr. Marsh: I am not suggesting a direct subsidy by electricity consumers.

Sir G. Nabarro: The right hon. Gentleman has just said so.

Mr. Marsh: It might help us all if we listen closely to the debate. I repeat that it is not reasonable for this burden to fall solely on the consumers of gas and electricity. We have, therefore, decided to ask Parliament to provide for the cost to be met from public funds.

Sir G. Nabarro: How much?

Mr. Marsh: We do not know how much yet, but we are trying to see how far we can get increase in coal burn. We shall bring in a Bill to enable us to take this action.

Mr. Edward M. Taylor: Mr. Edward M. Taylor (Glasgow, Cathcart) rose—

Mr. Marsh: This is a serious debate. Many hon. Members wish to speak.
I want now to turn to the social consequences of this position. Since I became Minister of Power I have realised

that, if one was not aware before, one very rapidly becomes aware, when once involved, of the very real hardship which can and does occur in some areas where mining is the mainstay of community life. [HON. MEMBERS: "Hear, hear."] I say that at once. It would be pointless for anyone to seek to pretend that these hardships do not exist. Anyone dealing with them is only too well aware that, unhappily, they do exist.
The Government already have particular regard to colliery closures in their general assistance to less prosperous areas. When the regional employment premium was introduced, this year, the Government specifically had in mind that the continued rundown of the coal industry was a major factor calling for a further big step forward in the development areas. This will ensure that the disparities between the development areas and the rest of the country will steadily narrow over the next few years, despite the impact of colliery closures and other technological changes. Nevertheless, in some parts of these areas, closures raise serious problems which require a special effort, and all Departments concerned are now engaged in a co-ordinated drive on this problem.
There is also a very special problem for the older and partially disabled men for whom the pits have provided employment, but who will find it difficult to obtain employment elsewhere. We are, therefore, preparing a scheme whereby mineworkers who become redundant and have to leave the industry at or after the age of 55 will have their income supplemented by the Board for a period so that they can adjust themselves to their new circumstances. The scheme will also provide that, at the end of the period of adjustment, the men will receive their mineworkers' pension immediately without waiting for the normal pension age of 65.
I am also reviewing some of the present benefits payable by the Board and ranking for a Government contribution under the 1965 Act, in the light of new estimates of the numbers of men who will be leaving the industry or transferring to new jobs within the industry.
I have come to the conclusion that these benefits are so important that we must reduce obstacles to their payment to a minimum. At present, the Board


pays the first £3·8 million a year of the cost of such benefits and split the rest with the Government, subject to a maximum of £30 million for the Government's share.
This arrangement has regard to the social obligations of any good employer and to the economic benefit to the industry of concentrating production and men. Nevertheless, it presupposes that the Board's revenue account can stand this charge without risk to coal prices and coal sales. I am examining this to see whether it still holds. If it does not, I shall seek to amend the 1965 Act to relieve the Board as far as necessary of the financial burden. I shall in any case ask Parliament to provide for the whole cost of the new benefit for elderly redundant miners on the lines I have described. These proposals are not just more protection for coal, but a measure of social justice and economic realism.
I come now to the use of primary fuel at power stations. The arrangements for securing additional coal use at power stations over the next few years supersede the present temporary measures whereby the C.E.G.B. gives coal preferential treatment in determining fuel use at existing stations. As a corollary to this and to the longer-term assessment, the C.E.G.B., in seeking my consent for new power stations, will in future base its choice of fuel on an economic assessment of the cheapest costs of generation. Let me emphasise that all fuels—coal equally with the others—will be considered by the Board on their merits.
There is a substantial amount of new coal-fired capacity coming into service over the next few years, and coal stations will form by far the greater part of the total installed capacity for many years. The electricity industry clearly has a continuing interest in the health of the coal industry, for it would bear increasingly the brunt of the effects of any increases in the costs of winning coal.
The interim limit of £700 million was intended to ensure that the House would have an opportunity of reviewing the affairs of the industry roughly half-way through the period for which the full borrowing provision was expected to last.

Mr. Lubbock: I am grateful to the right hon. Gentleman for giving way. He is very long-suffering. May I ask him for an assurance, in view of what he has said about looking at new power stations on their economic merits, that Heysham and Seaton Carew will not be transferred from the nuclear to the coal sector?

Mr. Marsh: They will be examined, as will any other applications, on their merits. I have not received them yet. When I do, I shall examine them in the light of what I have said.
As a result of developments which I have described, the industry faces a continuing borrowing problem, in particular to finance the coal stocks to which I have referred. It is partly because of this that it is necessary to ask the House for an extension of the Board's borrowing powers. In 1966–67, after the price increase which took effect from the beginning of that year, the Board earned a small surplus, but insufficient to provide full depreciation on a replacement cost basis. It is vital to the industry's future that the modernisation of the economic pits which will have a continuing life should not be held back for want of capital.
The greater complexity of modern equipment and the increasing mechanisation per man means that, despite the closure of collieries, investment in the industry must continue at a high level. In the light of these problems, and of the figures which I have given, I must warn the House that I expect to have to seek further borrowing powers early in the new Session.
Britain now uses rather under 300 million tons coal equivalent of energy a year. After making allowance for potential increases in the efficiency with which the different fuels are used, we can expect the total primary fuel requirement to rise to about 350 million tons by the mid-1970s. During this period, the pattern of our energy supply will be transferred by the rapid development of North Sea gas and nuclear power. Together, these new fuels will not only take up the natural increase in our energy needs but also meet a growing share of the total requirement. By the mid-1970s, they may


together be supplying nearly one-quarter of our needs, or about 85 million tons coal equivalent.
By the mid-1970s, the uncertainties of forecasting increase, but I would expect, on present trends, given the uncertainties of forecasting this far ahead, coal sales of about 120 million tons. The figure of 80 million tons by 1980 has been mentioned. I want to make it clear that that was a working paper figure. I do not think that any of us would care to back figures that far ahead too heavily.
The continued contraction of the coal industry is an inescapable part of the changing pattern. To attempt to reverse this long-term trend would be grossly wasteful of resources, would mean adding quite considerably to industrial costs, and, in my view, would almost certainly fail. But coal will need help in making the transition to the smaller, more compact industry of the 1970s. With the measures that I have outlined and the co-operation of management and men, I believe that the transition can be accomplished smoothly.
It is not possible to reach a single, definitive set of answers to fuel policy problems. We shall certainly need to retain flexibility in the future to cope with factors that are at present uncertain and to ensure that, when decisions are needed, they are taken against as comprehensive and detailed a background as it is possible to produce. I believe that we are now developing the right machinery and the framework to do this job.
I apologise for having spoken at considerable length. The problem with which we are faced is a very serious one. It is one with big implications on the economy, on our balance of payments and, more important, on people. I do not think that it is possible to fix on a firm straight road which goes along passing certain mileposts on the way. What we are seeking to do is to find a framework to establish that which is happening, to see how far it is possible to distort that, and what the cost of the distortion is.
This is a very interim statement. There is a great deal more work to do, but I thought it right and proper on this occasion to give the House what information we have available.

11 p.m.

Sir Keith Joseph: The Minister of Power, trying to help the House at this hour of the night, cantered through a very important speech, but he had no need to apologise for the length at which he spoke. He has an unusually packed, an unusually well informed and an unusually deeply concerned audience in the Chamber. There is a concentration of passion and knowledge. We all welcome the news that the Government propose to produce a White Paper on Fuel Policy in the autumn which, no doubt, we shall have the chance then to debate.
The Minister had a very difficult task tonight. Governments, of both parties, have for a number of years been presiding over the fairly rapid decline of the coal industry. I remember the speech of the Chancellor of the Duchy of Lancaster, which was generously acknowledged by my hon. Friend the Member for Yeovil (Mr. Peyton) speaking from this Box, in which the right hon. Gentleman, with all his background, spoke of the need to allow the industry to contract.
This is not a problem unique to this country. As the Minister said, all over Europe coal is on the defensive. I wish that, like the hon. Member for Loughborough (Mr. Cronin), I could point to America and hope for a miracle for coal in this country. America, Russia and Poland are seeing rising coal outputs and rising coal demand, but we, I think the Minister will agree, have thinner and deeper seams than thoe countries. While we can hope for a miracle, it would be wrong for either side of the House to count on it.
All we can say is that we on this side, as with hon. Members on the Government side, want the largest coal industry in this country that is competitive. That is what we want. We recognise that while the coal industry is finding its way down to that competitive size in which it can hold its own market in a competitive world, there is justification, socially and economically, in helping the contraction to come about with the least damage to people and to communities. That we recognise. All that we ask is that the Government shall not deny the people and industry cheap energy. We recognised in the Minister's speech this evening an attempt to reconcile both humanity and economics.
I could pick detailed criticisms on detailed points and, no doubt, hon. Members, with their deep knowledge, will find much to criticise, but let us all recognise that, at least, we are dealing with formidably strong market forces and that our interests not only comprise the interests of the communities and people dependent for a living on coal, but comprise, also, the population as a whole, which needs cheap energy if we are to compete in the world and we are to have a decent standard of living.
Let us also remember that when coal, which has already slimmed much from the giant that it was, has slimmed down to a really competitive size, it will still be a giant industry with a considerable future, demanding all the talent and the dedication that it can obtain.
My only warning to the Minister, before I come to some comments and questions, is that, as he well knows, detailed plans and figures are apt quickly to be overtaken by events. I do not disagree with the orders of magnitude which the right hon. Gentleman used. We on this side do not have the equipment to criticise them in detail. They seem to me to recognise the forces of the market and to offset those forces by sufficient delaying action to allow the humane protection of the communities and people who are dependent on coal.
I now come to the Order and to some detailed comments. The Minister has explained that the large amount of extra money that he is seeking to allow the Coal Board to borrow is necessitated to a certain extent by the increase of stocks. As he well knows, however, stocks at the end of 1966 were 18 million tons. Are we to understand that the finances of the Coal Board have deteriorated so badly because of an increase in stocks from 18 million to 30 million tons?
I hope that the Parliamentary Secretary will explain why it was that as recently as late 1965 the right hon. Member for Newton (Mr. Frederick Lee), then the Minister of Power, predicted that the borrowing power of £750 million would suffice right the way through to 1971. How could he have predicted as recently as that that the Board's borrowing power would be adequate? Here we have the Minister asking the House to use the last tranche, the £50 million

tranche, and warning us that early next Session he will seek further borrowing powers. Does this mean that the Board will go on increasing stocks? If so, we would like to hear what the size of these stocks is expected to be.
We on this side of the House—and I do not expect that there will be any disagreement about this—would like to pay our tribute to the successes which the coal industry has notched up in the last years. They have been considerable. Mechanisation is nearly universal. Output per man-shift has risen 40 per cent. since 1960, due partly to increased mechanisation, and partly to the shift to more productive pits. Technical development has been in part brilliant, particularly the self-moving supports, and the remotely operated long wall face equipment.
I understand that the Board has redeployed miners and their families with great success and humanity across the country. To all this we would like to pay our tribute. We understand that the rundown in management and staff—and here I refer to a report in the Financial Times of six months ago—has also been very competently carried out. We also recognise that the Chairman of the Board has spoken out pugnaciously to the industry about the importance of coal being competitive, and to the country about the importance of giving coal a chance to be competitive.
Having paid all those tributes, I would like to warn the Minister and the House of danger signals which now seem to be in sight. First, the maintenance of morale in an industry declining in market and size is a very delicate operation indeed. I know that the Minister and hon. Members appreciate this. It is true that the squeeze has apparently reversed the drain on manpower for the moment, but it is obviously very difficult to keep the balance of skills and management and ages apt for an efficient industry.
I understand that there are empty Coal Board houses beside profitable pits. I understand that profitable pits tend to be in areas where there is a choice of jobs, and that in these areas young men are hard to recruit, and school leavers particularly hard to get. I understand that in the East Midlands, the pride of the Board, hardly any school leavers can be


obtained. On top of unbalanced wastage, the problem of absenteeism makes life particularly difficult for a coal industry which is seeking to be efficient.
What I want to warn the Minister is that the failure to staff the good pits may, even if the demand for coal goes up, endanger the cost objectives that we have for coal. This is why we on this side recognise that the rundown of the coal industry to its competitive core must be conducted in such a way as to retain the confidence and the morale of all concerned as much as possible.

Mr. Thomas Swain: I have been listening to what the right hon. Gentleman has been saying. If he saw a collier coming out of the pits, he would not know the difference between him and a black-and-white minstrel. I was wondering which Government fundamentally destroyed the morale of the men in the mining industry.

Sir K. Joseph: I spent only a week in a coalmine, in 1936, when I worked with the Quakers in a pit in Yorkshire, and I know from those few hours that the fewer people who have to face that arduous and dangerous life the better, provided that they have a choice of jobs. Surely we are all agreed on that. The hon. Gentleman sinks below the level of the debate in making party points of that order.
The Coal Board predicted as recently as 1965 that 100 million tons a year would be mined by remote control. Since the Bevercotes episode, what are the prospects of remote control mining spreading? I realise that it is appropriate only to some pits, but what are the prospects of the Board's prediction being fulfilled? The key factor in running down an industry is not only morale, but the quality of management. Without recruiting and holding good managers, the most efficient deployment of men and machines is not possible, in which case, bang go our hopes of reduced costs, on which coal's competitive prospects depend. The Prices and Incomes Board had some doubts about the industry's productive capacity at competitive prices, even if demand held up.
There is an extra danger in diversification. We expect that most of the industry's diversification plans will lose money, which is bad enough, but just when top management should be giving all its attention to the delicate job of running down the industry to its competitive core it will tend to be diverted to the far easier and more entertaining occupation of bidding for other companies which seem to offer an easier way of making a living. I ask the Minister to be very cautious in allowing management to disperse its energies. We should like to know what the yield on capital criterion is for such investment. We know that the Coal Board is required to produce a certain yield on overall capital, but do not know whether the Minister imposes a certain standard on non-colliery investment.
The industry has the good coal seams to exploit, in the East and West Midlands and Yorkshire above all, and the techniques to exploit them, and can, therefore, provide cheap coal and hold its market if morale and confidence and management hold good, but there is still the problem of the isolated pits in South Wales, Scotland, Durham and other places, where the lives of the community tend to be totally dependent on coal.
I think that we would all agree that the fewer who are forced to earn a living in this way the better, provided that there is a choice of jobs for them. The Minister made two announcements of particular interest this evening, one about the special help to enable disabled men over 55 to retire and the other about extra help—no, that was the Government's only specific commitment on the social side. He explained that there was a Departmental review of help that should be given—

Mr. Marsh: There are the questions of suitable supplementary assistance to the over-55s, their ability to obtain their full pension without having to wait until they are 65, and, in addition, a complete review of the provisions of the 1965 Act.

Sir K. Joseph: We recognise that retraining, rehousing and removing must form a great part of the Government's help to people who are denied a choice of jobs because there is no choice in the areas in which they live. We recognise


that in some cases people may have to face moving if they are to have jobs. We recognise that that may not be popular in some areas, but we hope that the Government will co-ordinate all their activities to reduce the pains of this contraction.
If the N.C.B. can concentrate more and more of its output in profitable pits, the industry has a fine future, but it must reduce its costs. The Chairman of the Coal Board explained to the miners' conference at Eastbourne this month a number of ways in which costs could be reduced. He spoke not only of the shift to profitable pits, but of a relatively small shift of men from surface to face work and of a relatively small increase in machine utilisation. He spoke of these as bringing in the possibility of a really substantial cut in coal costs that would bring coal down to the target area of about 3¼d. a therm.
I would have liked, but for the primacy of cost, to have asked the Minister to have gone slower on opencast, but it would not be responsible to suggest that we can dispense with opencast. We get only 3 per cent. of our coal from opencast, against the American 40 per cent., but we recognise that land is never quite the same again after opencast mining and that there must be some areas where beauty must have priority over economics.
In coming to the huge question of competition, although oil, nuclear energy and gas loom large in miners' eyes, perhaps the most formidable danger that coal faces is the unbalanced loss of miners and managers and the unbalanced wastage coupled with increasing absenteeism. These can endanger the cost competitiveness of coal almost more than anything else.
We must recognise, as the Minister said, that oil is already penalised to protect coal. About £80 million is placed on the consumer and industry to reduce the speed of the rundown of coal. We must recognise that there is a total ban on imports of coal and that the coal preference has gone so far that the electricity authorities are straining at the leach to escape from the obligation to burn coal in places where they want to burn, say, gas in the summer and oil in the winter.
It is for the Minister, with his knowledge and advice, to judge the pace at which morale and confidence can be maintained. The right hon. Gentleman is now asking the C.E.G.B. to accept more of the coal it no longer wants. I suggest that there must be a turn in this protection. My hon. Friends and I do not deny the need for some protection to ease the rundown, but if coal is to get to the target we all want to see—to the point when it can hold its own market in a competitive world—then, perhaps over a period of years, and by a number of stages, the protection should be whittled down so that, in due course, in the 'seventies, the industry can stand on its own feet, finding its markets from the product of its low-cost pits.
There are a number of questions about competitiveness which the Parliamentary Secretary should answer. When is a decision expected about the price of North Sea gas? What about Algerian methane? Hon. Members who represent coal mining areas are very ambivalent about the price of gas. They hope to see the price high enough not to comfort the oil companies, but not low enough to embarrass the Coal Board. The Government have to preside over a decision. I hope that it will be an agreed decision, and that the Minister will not have to act the part of Solomon. Would the Parliamentary Secretary tell us whether there is any truth in the rumours that AMOCO, the oil company partners of the Gas Council, are contemplating withdrawing three rigs from the North Sea because of frustration due to the lack of agreement on price?
Because of time, I shall not embark on the fascinating subject of nuclear power. I am sure that it will be raised from the other side of the Chambers. I would only say to hon. Members that however much, to use the classical phrase, they pick nits in the cost or estimated cost of nuclear power they must recognise that in America, where coal is very much cheaper than it is here, nuclear power has been adopted, not just by one, and a nationalised, industry, but by large numbers of independent utility groups in the interests of their consumers. Nuclear power will be a formidable supplier of energy, and we should be grateful for it, and it is to live with nuclear power that we all want coal to be much more competitive.
Therefore, although we on this side do not like direct subsidy, and, therefore, do not like the Minister's preference for a direct subsidy in this case, we recognise that, left to the market, the coal industry would run down so fast that its ultimate capacity to provide, as we know it can provide, the cheap coal for our consumers and our industry would be jeopardised. We recognise that price is the key, and that the industry must be given the chance to contract down to the competitive low—cost coal with the minimum unhappiness for those communities and miners who happen to work in those isolated pits which, by ill chance, are the least competitive in their pricing.
We on this side, therefore, do not disagree with the main tenor of the Minister's statement, though we shall at different stages have a number of detailed points to make.

11.22 p.m.

Mr. E. Shinwell: No hon. or right hon. Gentleman can doubt for one moment the difficult task that faces my right hon. Friend. He has to reconcile conflicting elements of technological development, nuclear energy and modernisation facing an industry that has been gradually fading away and has been confronted throughout its whole history by innumerable problems. I want to preface what, I hope, will be a short speech by one or two observations.
The first is that I regret that a debate of this character—

Sir G. Nabarro: Hear, hear.

Mr. Shinwell: —certainly much more important than the subject of abortion—

Sir G. Nabarro: And homos.

Mr. Shinwell: —and homosexuality, should be taking place at this time of night—

Sir G. Nabarro: Where is the Leader of the House?

Hon. Members: Order.

Mr. Shinwell: I cast no aspersions on my right hon. Friend. Indeed, I shall not use this occasion to make a personal attack even on the Leader of the House, although sometimes I am sorely tempted. This is merely a digression, which is not

altogether in order, but perhaps I may be allowed this latitude. The business of the House for some time has been managed not altogether too well. I am speaking very moderately. A vast volume of legislation has been forced through the House. That often happens—I have experienced it myself over the years—but it would have been to greater advantage for hon. Members who are deeply concerned about the condition of the coal industry and, in particular, its future, and also to the House itself, if we had had more ample time to debate this subject and if a debate of this important character had been preceded by a White Paper, or a document which set forth the pros and cons of all the arguments associated with fuel and power policy.
May I indulge in one warning? No offence meant.

Sir G. Nabarro: I bet there is.

Mr. Shinwell: I hope that no decision will be reached during the forthcoming Recess about a national fuel policy which deprives hon. Members on both sides of the House of an opportunity to express their opinions. It has happened before that decisions have been taken by a Government when the situation demands it in the opinion of the Government and hon. Members are not available to take part in a debate and to express their opinions. In particular, I hope that no firm decision will be taken about whether the proposed electricity power station at Seaton Carew will be based either on nuclear energy or on coal. It is a matter for very careful consideration of the price, cost of the site itself, and also social considerations.
This is, for me, a most distressing occasion, for more than one reason. I have represented two mining constituencies since I first came to the House in 1922. One was West Lothian, which at one time was almost exclusively a mining constituency. I think how it has been completely emasculated. Very little mining remains there now. Since 1935, I have represented Seaham Harbour, now Easington, perhaps the most progressive and prolific mining area remaining in the County of Durham. The pits on the coast are regarded as viable. Most of the pits in the Durham coalfield are no longer regarded as viable; they are losing money.
There is another reason why I feel somewhat distressed. I had the privilege in 1946–47 of piloting through the House the Bill to nationalise the coal mining industry. I had been advocating it for 50 years or more and at last there was a glorious opportunity. I was exhiliarated. This was a remarkable occasion. I had a vision of an industry, progressive, up-to-date, modernised, with those employed in it below ground, on the surface and in the offices associated with the industry contented, well-paid, with the very best conditions made available to them.
My vision has not been realised. On the contrary, ever since nationalisation—I must be careful; I do not want the Opposition to make too much of it.

Sir G. Nabarro: I will not.

Mr. Shinwell: I know hon. Members opposite better than the hon. Gentleman who has just interjected knows them. I have had longer experience of them. They may make political capital of what I am about to say. The nationalisation of the mining industry has not worked out as I had loped it would. It is as simple as that. Therefore, I am a little distressed about it.
When I became Secretary for Mines, in the first Labour Government, one million men worked in the industry. On vesting day, there were nearly 700,000 men in the industry. Today, there are 400,000. My right hon. Friend referred frequently to the need for a slowdown. There has been far too rapid a reduction in the manpower on the number of pits available. Who is to blame for it? The Labour Government went out in 1951. The Conservatives came in. That was their opportunity. They cordially disliked nationalisation and had made their views well known to the House and to the country. Their dislike of the nationalised industries had been frequently repeated. This was their great opportunity. The pits had to pay regardless; never mind the social consequences, the pits had to pay. It has even been stated now in the House that the pits must be viable.
The right hon. Member for Leeds, North-East (Sir K. Joseph) made an interesting speech, as he usually does, but a t the end he shed a few crocodile tears about the industry and about what must

happen in the 1970s. He said that it must pay its way. The Conservative Party's attitude is that everything must pay its way, as if private enterprise and private industry always paid their way. Look at the number of bankruptcies that occur and the number of industries that fall by the wayside. What happened in the motor car industry? Look at the position of the great oil industry at present because of a little fracas which has occurred in the Middle East. The Tories should not talk too much about the nationalised industries. However, this is perhaps a little too political and too partisan.

Sir G. Nabarro: No.

Mr. Shinwell: I do not want to encourage the hon. Gentleman. We want a serious debate.
My Right hon. Friend, in his very engaging and interesting analysis, dealt with these conflicting elements. It is impossible to make a sound judgment on the merits or demerits without sitting round a table, examining documents, listening to experts, and interrogating witnesses, over a period of time. How can we do so in the course of a debate?
I, like my right hon. Friend, have had the experience of being given advice by civil servants and by experts. It is no use complaining about civil servants in the House; it is improper. However, I cannot help reflecting on how often I was provided with wrong estimates. I remember that on one occasion I gave the House an estimate of electricity consumption, based on what the experts had told me. What did I know? My right hon. Friend said that he was no technical expert. I had even less technical knowledge than he has. However, I listened to the experts, only to be told a week afterwards that they had given me the wrong estimate. When I told the House, "I took the advice of my experts", how the Opposition laughed and jeered.
No Minister can escape by exposing his advisers. Therefore, when my right hon. Friend presented his analysis I could not help feeling that, after all, perhaps his advisers were wrong. It is as simple as that, or maybe as complex as that. He himself was not quite sure.


On one point he said that perhaps they were wrong.
I am not fascinated by those people who predict what is to happen in the 1970s and the 1980s, when I consider what I predicted in 1946 and 1947 and I have more claim to be a prophet—I am not speaking in a monetary sense—than many hon. Members. I had to point out to the late Winston Churchill on one occasion, when he mentioned that his ancestor was the Duke of Marlborough, that I was a descendant of Moses. Yet, with all the knowledge that I possessed, and despite all my advisers, my predictions came to nothing. They evaporated into thin air.
That is the position. We have on one side Lord Robens, who also has his advisers. Lord Robens has come to the conclusion that coal can be made to pay and that there is every reason why it should be the basis of electricity generation on a large scale. That is his opinion. On the other hand, we have my right hon. Friend's nuclear advisers who take a contrary view. What do we do? I can tell hon. Members what we are expected to do. We are expected to do as the Government tell us. Is that not the position? Even if we are not quite certain ourselves, even if we consult other experts, at the end of the day we are always told that the Government are right, that Whitehall knows best. Sometimes I feel that they may be wrong.
I do not want to indulge in any kind of emotional outburst. I am not inclined to that sort of thing. But I was in Durham last Friday and Saturday. I listened to the murmurs—in fact, more than murmurs—of discontent from miners on all sides. We had the big day in Durham, the Miners' Gala, a most depressing event for the simple reason that there is throughout the whole of the coalfield there a sense of insecurity even in the best and most viable pits.
There is a very great danger. When my right hon. Friend talks about the future of the industry, about a slowdown, the phasing of the rundown and the rest of it, he tries his best to be optimistic. I can understand it. He has got humanity. He has got to do his job, but even in the Department he retains his

humanity, although it is not always easy. But when he talks about this, he appears not to understand that in these measures there is insecurity and even the most viable pits will lose their men. That is the great danger.
I speak of Durham, but I read in the business section of The Times, which, as my right hon. Friend is aware, is read only by the top people, that in Derbyshire—my hon. Friend the Member for Derbyshire, North-East (Mr. Swain) must be aware of this—and in Nottinghamshire the decline is coming. People are deeply concerned about possible pit closures there, too. It is a remarkable fact that, for some years now, the Coal Board—all credit to it for doing so—has done its best to transfer men from the rapidly declining parts of the coalfield down to Nottinghamshire, where the best seams are. I have a long acquaintance with the miners of Nottinghamshire—I have spoken in every part of the Notts coalfield—and I recall how often I have heard them boast about their 6 ft. seams, nothing like the 18 in. seams we have in Durham.
But now there is talk of closures. And what are the miners asking for? They are asking for alternative employment. Both my right hon. Friend and the right hon. Member for Leeds, North-East referred to this, and they spoke of retraining and the rest—all the jargon, if I may say so, which is regarded as an alternative to providing employment for men in the pits.
There are others who say—I have heard it said even in this House, on both sides—that it would be better to have no pits at all, not to have men going deep into the bowels of the earth to bring up coal, and to provide more congenial employment for them. It is all very well to talk like that. We cannot find the alternative employment. In the County of Durham, in Sunderland, there is 7 per cent. unemployment. In Horden, in my constituency, where we have the largest pit, unemployment is 5 per cent., almost twice the national average.
I give every credit to the Government for what they have attempted, to my right hon. Friends the President of the Board of Trade, the Minister of Labour and other Ministers, for advance factories, for


light industry, for subsidies to shipbuilding. The previous Tory Government provided a subsidy for shipbuilding, too. All credit to those who are anxious to help. I recognise and appreciate what is done. But unemployment is rising, nevertheless. We shall not solve it by talking about nuclear energy. Indeed, modernisation does not appear to be a solution.
We have got to recognise the social consequences. What will happen? In his interesting speech opening the debate, my right hon. Friend gave an engaging analysis of the situation. If he made a speech like that to a group of miners who were insecure, many of them out of work and trying to find alternative employment, it would be above their heads. It would make no impact at all. We can talk as we like about modernisation, technological developments and advances of that kind, but the fellow round the corner is looking for a job. What are we going to do about it?
What about the palliatives of which my right hon. Friend spoke? There is one which the Coal Board and the National Union of Mineworkers could arrange out of their pension funds. There s a large sum of money there. They could increase the pensions available to miners. That would be something, and it could he done out of their pension Funds which, I understand, are invested very satisfactorily. But much more than that, much more than was suggested by my right hon. Friend, needs to be done.
In my view, the best thing to do would be to do everything possible to make the mining industry more competitive, so that it could remain as a viable industry. But, if it is not completely viable—I may not carry the whole House with me in this—it may be necessary, so as to retain the industry, to provide subsidies. Why are we worried about subsidies? The farmers on the opposite side of the House do not worry about the agricultural subsidies. The people of the North-East and elsewhere do not worry about the subsidies provided by the Conservative Government and this Government—the investment allowances and all the rest. From the standpoint of social considerations, they should not be neglected, certainly not by a Labour Government. It may be necessary to provide the funds required to maintain the industry.
I issue this warning to my right hon. Friend—it is merely repetition, but I do not apologise for that: insecurity is rapidly developing and there is a remarkable momentum in insecurity. We may discover that even in the 1970s or 1980s 140 million tons of coal will not be required. Far from that figure, probably much less than 100 million tons will be required. When we reach that situation we need not talk about a viable mining industry. It is the Cinderella of industries now, and we should try to prevent that happening.
I wish that I had the complete remedy, but I must confess that I do not see one. I think that the rapid down-grading of the mining industry has gone too far, and it is very difficult to recover. With the help of the Coal Board, the Ministry of Power, the Government, and even with the support of right hon. Gentlemen opposite, who, I am certain, are as anxious as we are to help, I doubt whether it will recover. Therefore, at the end of the day we must have regard to the social consequences and bring to bear on the problem all the power and resources available to the Government of a social character to alleviate the conditions of those who are displaced from the industry, and mitigate the harsh details of unemployment and poverty.
That is all that I think it is possible to say, but I wish to add one thing to my right hon. Friend. If he proposes to ask the House or the country one day to consider a national fuel policy, relating various ingredients into a whole, I hope that he will consult the House first, and that he will precede any debate that may take place on this very important topic, by giving hon. Members all the information available on all sides, without any partisanship, and completely objectively. I think that we are entitled to expect that before a final decision is reached.

11.48 p.m.

Mr. John Peyton: The whole House knows how deeply the right hon. Member for Easington (Mr. Shinwell) feels on these matters. My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) can congratulate himself that the right hon. Gentleman spoke so kindly to him. It was a great tribute to my right hon. Friend's speech on this vexed and very difficult subject that someone with the past of the right


hon. Gentleman—I say this with no disrespect to him—should speak so mildly of a political opponent's speech.
In your wisdom, Mr. Deputy Speaker, you permitted the right hon. Gentleman an excursion in which he commented briefly and politely—politely, in the circumstances—upon the recent conduct of business in the House. I find it a matter of regret that the Leader of the House, who has, as the right hon. Gentleman said so mildly, left a lot to be desired in his conduct of business, should have slunk away, displaying once again that discourtesy and arrogance which have characterised all his handling of the affairs of the House.
I do not know whether the Leader of the House is aware of the depth of feeling that he has caused. I recognise that it is not easy for back benchers on both sides of the House to unite against an unpopular Minister. But I do not believe that many Members in the capacity of Leader of the House have served it as ill as the present incumbent of that post. Tonight is a simply disgraceful example of his entire disregard for and lack of understanding of the strong feelings that many hon. Members have on a subject of this kind.

Mr. Cronin: I hope that before the the hon. Gentleman presses his criticisms too far, he will bear in mind the difficult situation that we are in tonight of having to debate this important subject so late is very largely due to obstruction by his right hon. and hon. Friends on other matters earlier.

Hon. Members: When?

Mr. Peyton: I was unaware that the hon. Member for Loughborough (Mr. Cronin) had been quite so frequent a visitor to our debates lately. We welcome his exceptional appearance here tonight. We rather doubt the merit of his judgment in these matters. No doubt his neighbour, his hon. Friend the Member for Ebbw Vale (Mr. Michael Foot), has whispered a few words in his ear. However, he ought to know that always to listen to his hon. Friend the Member for Ebbw Vale could lead him astray.
Mr. Speaker, I hope that you will be as tolerant with me as you were with the

right hon. Gentleman. I wish to outline some of the problems that affect the industry. The Minister was perfectly fair in the figures that he gave, such as the fact that stocks are up by 5 million tons on what they were last year or the figure that he gave of a 7 million ton increase during the last six months. This year's sales are down by nearly 8 million tons on last year, and production is down by nearly 3 million tons.
In these circumstances one has to ask: where is the market for coal in the future? However the Minister may protest, he is facing, as he knows very well, a desperately difficult situation. He knows that none of the measures to which he has referred—about which I shall have a word to say in a moment—will really touch the problem. There have, of course, been Conservative Governments and they must have their share of responsibility for this long-term problem, but I believe that the error has come in that we have not been willing to face the problem early enough, that the declining market for coal was not realised soon enough and least of all by those who are the most enthusiastic advocates of the coal industry.
The Minister said that, despite the protective measures, coal has continued to lose ground. I am certain that despite any further protective measures that will continue. We now have four measures of protection available for the industry. First, there is the ban on American exports. Secondly, there is the tax on fuel oil, which I regard as a great mistake, and certainly a mistake which should not be continued. Thirdly, there is the immense measure of capital subvention of the 1965 Act. Lastly, there is the measure which the Minister is now proposing, which, however he may dress it up, is a direct subsidy to the coal industry.
The right hon. Gentleman called it a subsidy. I very much doubt how far any industry which once receives the treatment of subsidies really benefits from it. I believe that subsidies are very apt to take the heart out of an industry and take its virility away.
The Minister frankly told the House what no one can challenge, that we in this country cannot possibly afford to deny ourselves the advantages of cheap fuels. I believe that we must all accept those words from the Minister. At the


same time, there is a considerable dilemma that the country faces because a very large part of the electricity industry is tied to coal. This is a difficult question to answer, but had it been possible to drag the industry earlier out of its 19th century postures, particularly in the East Midlands, Yorkshire and the West Midlands, it may have been that the pay of the miners in those areas would have risen and the week that they were expected to work modified, and attempts made to make the industry attractive to more people. This did not happen and we are presented with the danger that if the morale of the industry goes there could be a serious collapse of production and power stations relying on coal might be deprived of their fuel.
Therefore, it behoves us all, on both sides, to speak with some caution about the coal industry where the livelihood of so many men, as the Minister rightly said, is so deeply concerned. We would do well to remember what a tremendously emotional industry this is. It is a contradictory one. Many people have said that no one wants to condemn men to living and working underground in conditions of dirt and danger beyond what is necessary. On the other hand, There is a strange contradiction when people who work in, say, the motor industry will not be endlessly discussing their work when they are having a drink in the evening. But the coal industry enters strangely into men's lives. This is a fact we do ill to ignore.
I believe that one of the worst services that the supporters of the industry can do today is to utter expressions of blind optimism. I wish to make it clear that those who repeatedly said in the past, despite the evidence to the contrary, that 200 million tons was a realistic target for the industry were far from helping the industry. They have concealed the real facts far too much and they have inhibited and hindered the industry in its real progress.
My hon. Friend the Member for Worcestershire, South (Sir G. Nabarro), with whom I rarely disagree, earlier expressed the opinion that he preferred the judgment of Lord Robens to that of the Minister. On this point I disagree with my hon. Friend. From all that the Minister has said tonight I greatly prefer the judgment of the right hon. Gentleman.

Sir G. Nabarro: The reason I made that statement is not far to seek, if my hon. Friend will bear with me for one moment. The Minister said this on 10th June, 1967, about the coal industry:
We have had a rough time and now the future is very rosy.
That was in the Financial Times of 12th June this year. What arrant tripe the Minister talks.

Mr. Peyton: I was interested to hear my hon. Friend's intervention. I did not actually see that quotation, so I hope that he will forgive me if I do not comment on it now.
I want to carry on with the point I was making and say how wise I think the Minister was to resist the blandishments of Lord Robens to set up an energy or power committee which would take over the Minister's job. I can only imagine that the proposal was put forward with the thought that Lord Robens would be wafted into the chair. I would like to make it clear that in the event of any such arrival taking place—and I do not wish to seem vain—the Minister would have my support, for what it is worth.
I have, I hope, been fair to the Minister about what he has said. But now I must come to something more critical of him. He spoke at quite a rate of knots and we were not given the benefit of a White Paper which would have made it easier to assess the value of the announcements he made.
As I understand, the electricity industry is now to consume more coal, with possibly some help from the gas industry, as the right hon. Gentleman put it. It might be all right to give that sort of answer to a question at a weekend meeting, off the cuff, without notice, but here, when moving an Order extending the borrowing powers of the coal industry, it is not right to say something in such a vague and uncooked condition as that. We should be told what is meant by "possibly some help from gas industry".

Mr. Marsh: There will be a White Paper. It will be printed in the autumn. I made an interim statement tonight. In the discussions held with the heads of nationalised industries, at the Selsdon Park Hotel, we were told that the electricity industry felt that it was able


to increase its coal burning. So is the gas industry. But they have to look now in detail at where and how the gas industry can increase its coal burning, and this is a difficult job. We hope and expect that the gas industry will be able to increase its coal burning to 5 or 6 million tons.

Mr. Peyton: The right hon. Gentleman still has not really told us anything about the gas industry. As far as I understand, the gas industry was to go out of coal burning altogether by the mid-1970s. It is important to know some time from the right hon. Gentleman exactly how "some help possibly from the gas industry" will affect the long-term position. These vague statements do a great deal of harm.

Mr. Marsh: It is much more difficult for the gas industry to increase its coal burning than it is for the electricity industry. None the less, the position of the coal industry is such that we have to seek, if we are to hold the position, every avenue we can get to increase coal burning within reason. All I am saying is that the gas industry is considering how far it can assist by increasing its coal burning between now and 1970.

Mr. Peyton: I would hazard a guess—and I hope that, in the national interest, it will prove true—that it will do nothing to modify its present plans. I believe that to go back to, or keep alive any longer than it must, old-fashioned plant producing from an old-fashioned material would be an expensive mistake.

Mr. Alex Eadie: What will happen if there is a shortage of oil in relation to gas?

Mr. Peyton: I am not talking about oil, but about the gas industry. I am saying that I hope that it will not make the expensive mistake of continuing to use any longer than it has to old-fashioned plant and material. No doubt the hon. Gentleman will have his opportunity to express himself in the debate.
I do not feel that the Minister, in the vague measures of subsidy he has announced, will help the situation. I agree that he is under great political pressure. That must be the case. I acknowledge that he is facing a very difficult social problem, but I would advocate that where

outworn outposts of the 19th century coal industry are the source of the trouble those areas should be removed from the responsibility of the Coal Board and regarded as the responsibility of the Government as a whole. They should not even be handled by his Department, but by the Board of Trade.
It is desperately wrong to have as a long-term running sore a measure of further subsidy to the coal industry. Once established, the case for increasing it is almost unanswerable. In the long term, it will not meet the needs of the industry, and I am certain that it will not meet the needs of the country.
While I accept and understand the right hon. Gentleman's difficulties, and we are all sympathetic with the immense dilemma with which he is faced in the coal industry, I think that he has taken a retrogressive step tonight.

12.6 a.m.

Mr. Ness Edwards: Like my right hon. Friend the Member for Easington (Mr. Shinwell), I think that there is something wrong with our priorities when we discuss the destinies of 400,000 men and their families at this time of night.
Having said that, I want to sympathise with the Minister, who has an immense task and a terrible problem to solve. He has to deal with gas, electricity, nuclear power, coal and steel. It is a tremendous burden for any single Minister, especially in the fast-changing economic situation which we face.
I hope that he will appreciate that right hon. and hon. Members representing mining constituencies have difficulty in forming objective judgments about the present situation. They are all charged with emotion, because the death of a pit is the death of a mining community.
I do not know how many hon. Members watched a television programme on Sunday night which recounted the story of Senghenydd. I go there frequently. On the square, one can see men who have given their lives to the industry, blowing and puffing, the pneumoconiotics and disabled men gossiping with one another because there is nothing else for them. All hon. Members who represent mining constituencies are bound to feel strongly about these matters. They cloud one's judgment, and I am the first to admit it.
Most of us recognise that, to save as much of the industry for as long as we can, it is necessary to abandon all those parts which are not viable or which cannot be made viable. I know that it is hard to accept, but the consequence is that the industry in South Wales and in Scotland will shrivel, and all that we shall have left is a concentration on those pits which can produce coal at 4d. a therm.
As Lord Robens said at the hearing before the Select Committee on Science and Technology, the argument was that he could put coal in at 4d. per therm, but he could put that coal in at 4d. per therm only by abandoning all the other collieries where he is losing money. That means that nearly half our mining industry will be concentrated entirely in the Midlands and South Yorkshire and the rest of us will have shrivelled out of existence. That is the outlook that we face. We have got to face it and not run away from it.
Another additional quality which my right hon. Friend the Minister has to his problem is that there are over 41 million tons in stock, distributed and on the ground, and here we are at the beginning of the summer. If it were the beginning of the winter there would be some hope, but now we go on stocking until the winter. The outlook is that by the beginning of winter we shall have over 50 million tons of coal lying on the ground. That creates a problem not only of financial consequence—10s. for putting it down, 10s., for picking it up—but of deterioration. It is a frightening problem. In facing this situation, my right hon. Friend has whatever sympathy I can give him.
We of the miners' group of Members in the House of Commons have been interviewing Ministers for the last three years about the dangers in the situation that would lead to the present position. We have pointed out that unless steps were taken, the morale of the industry was going to pieces. We saw it particularly in South Wales, where even good pits became unviable because they could not get the manpower. That is the story that ore hears in every coalfield, both in the good ones and the losers. Therefore, we have tried to press upon

Ministers both the size of the problem and its urgency.
I heard my right hon. Friend say that it is now proposed to have Cabinet machinery to maintain oversight. A deputation from the miners' group was promised that two years ago. What has been happening? Last year, we had the position at Pwllbach, a colliery in the west of the South Wales coalfield. It was the only colliery in the village, which was dependent entirely upon it. There was nothing else there.
A deputation came up from South Wales, about 400 of them. Before we met the deputation, however, we had discussions with the Chairman of the Welsh Economic Council, the Under-Secretary of State for Wales, and with other Ministers, and we decided to work out a new technique of dealing with the problem. We had what we described as a task force. Where a pit had been given notice that it was to be shut, the Under-Secretary of State for Wales, the President of the National Union of Mineworkers and a member of the Welsh Economic Council would go to the village and discuss everything with everybody concerned, including the Coal Board. Unless alternative measures could be taken whereby all the men could be found alternative jobs, they would press the Coal Board to delay the closing of the pit until the necessary steps had been taken to provide an alternative life for the village.
For reasons which I need not go into now—they are quite outside the terms of this debate—the task force never functioned, and the new technique of dealing with the closure of a colliery on the spot where it occurred was never tried out. We are trying to solve a major new problem with old tools. What we have to devise is an entirely new technique to deal with the circumstances of the closure of any pit in the country.
I do not think that it can be done by one Minister leaving it to another. My right hon. Friend has had to face a great problem. The hostility which has been shown in the questions put to him arises from the fact that there is no one else to attack. He is the man who is responsible for this industry. He takes the decisions, but he is not responsible for the social consequences of the decisions which he


takes. We do not know who the devil is. We hear airy-fairy talk about retraining. We get the Board of Trade doing a little bit here and there, but there is no co-ordination. There is no central agency in each coalfield to deal with this problem as it arises.
I know that my hon. Friends who come from the area will forgive me for using Seaton Carew power station as an example to illustrate what I have to say. I believe that the development and growth of nuclear power is as inevitable as the decline of the mining industry. I think that we should continue with the A.G.R., but do not let us overload the consortium. Unless we continue with the A.G.R. programme, which will lead to faster breeder stations, in the 1980s we shall be buying from the Americans.
The great problem, as the Select Committee on Science and Technology saw it, and as Lord Robens put it, is the pace of the nuclear programme. In Lord Robens' view, the size and time schedule of the nuclear programme are of great significance, because he believes that the development of the nuclear programme at too fast a pace could have catastrophic effects on the mining industry. This was the effect of his evidence before the Committee. This is what he said at the miners' conference, and he made a speech in South Wales along the same lines. He was questioned very closely about this when he appeared before the Select Committee, and he limited himself to that.

Mr. Eadie: My right hon. Friend will be aware that we have had pronouncements and decisions by the Minister tonight, despite the fact that the Select Committee has not presented its evidence to the House. Does he not agree that there is something a little Gilbertian about such a situation?

Mr. Edwards: I will say something more about that. The minutes of the Select Committee have been published and I am deeply indebted to it for its information on this problem.
At Seaton Carew, a nuclear power station is to be put into the middle of a coalfield. I could understand it being on the South Coast, because of the transport of coal, but if Lord Robens think he can put coal into Seaton Carew at the equivalent of 6d. a therm, and that

this is competitive with the A.G.R., I cannot understand why tenders have already been requested for nuclear power construction at Seaton Carew—

Mr. Marsh: I appreciate that no decision has been taken on Seaton Carew. The industry faces a problem now and until 1970. Even if Lord Robens is right, and not another nuclear power station is built, this can have no effect on the industry until the 1970s. It does not solve our problem now, because they take seven years to build. My right hon. Friend mentioned low-cost coal. Would he not agree that, if the lowest cost coal were creamed off from coal, which is already expensive, the overall cost must inevitably rise, with disastrous consequences to the rest of the industry?

Mr. Edwards: But that was Lord Robens' case to the Select Committee. Let us assume that a nuclear power station would be fractionally more financially advantageous than a coal-fired one. But these are costs within the fuel industry. Does one count the cost of unemployment benefit if 8,000 men are made unemployed in Durham, or the cost of new capital investment to employ them? Should these social costs, including the cost of clearing the site, be considered? It is no good the industry enjoying tremendous profits if the country is to lose. This argument has not been advanced, and I was surprised that the Select Committee did not deal with it.
Hon. Members like myself feel that we cannot stand in the way of progress, or be Luddites. We want the A.G.R. programme to go on, but to be of such a size and time schedule as not to create difficulties for the industry which the Government cannot handle. Our policy decisions have created social problems for which we have no answers. Each consortium has a contract, and it is now proposed to give it two. This provides more work than the consortia can handle, but I leave that to the members of the Select Committee. If, as a result of this policy, pits must be closed, then, instead of the capital invested in them being carried by the surviving pits, it should be wiped out by the Treasury taking over.
In every coalfield a special agency should be established to deal with the consequences of this policy. I say this because we are concerned with the livelihood of our people. If we can give them a better livelihood than working down the pits, by all means let us do that, and the sooner the better. But in the abandoned pit areas the Exchequer should meet the cost of clearing up the debris. No area should be left derelict. Nor should it be left looking derelict.
I was glad to hear my right hon. Friend mention disabled miners and those over 55 years old. I wish that that statement could have been made earlier. Had it been, morale in the industry would have been higher than it is today. I hope that he will chase the question of enabling the electricity industry to burn more coal; but the extra cost must not be placed on the industry or the consumer. The Exchequer must foot the bill.
We expected to hear much more from my right hon. Friend. We understand that policy is not yet finalised and we hope that the White Paper will soon be published. It is to be hoped that the final decisions will not be taken about the future of this industry and those who work in it—people who have made the Labour Party what it is and who are responsible for our being in power today—without our having an opportunity to discuss these matters in detail.

12.27 a.m.

Sir Gerald Nabarro: Every Tory hon. Member deeply sympathises with the views of the right hon. Member for Caerphilly (Mr. Ness Edwards) and none can fail to be moved by his description of the pneumoconiotics in the square at Senghenydd. That is why emotion moves mining communities. It is also the reason for getting rid of deep mining, save only by remote control and highly automated processes, at the earliest possible date.
I do not propose to be drawn into these emotional considerations at this stage. I want to add my protest, loudly and clearly, to that of every former speaker about the disgusting Parliamentary habits of the Leader of the House. He goes away and has a "kip" on the bed in his room, coming back here in-

frequently to put his nose in the Chamber.

Mr. Swain: On a point of order. Are we discussing the Order or a Motion of censure on the Leader of the House.

Mr. Deputy Speaker (Sir Eric Fletcher): We are discussing the Order.

Sir G. Nabarro: I propose to add my voice to that of every previous speaker—notably the right hon. Member for Easington (Mr. Shinwell), who proclaimed in no uncertain terms that he strongly objected to Measures dealing with abortion and homosexuality taking precedence over one of our major and most fundamental industries—about the Leader of the House.
I come to the habits of the Minister of Power. Of course, he has carefully organised the frustration of the presentation of his fuel and power policy to this House, and deferred it until the autumn so as to be perfectly certain that the information in it is not available to hon. Members this evening when discussing this important financial Order. All our discussions this evening are invalidated because we have no information of the comparative investment in the other fuel and power industries correctly correlated or otherwise to investment in the coal industry. So it is no good the hon. Member for Ebbw Vale (Mr. Michael Foot) muttering—the right hon. Gentleman the Member for Easington entirely agreed with my view. We cannot consider investment in the coal industry in isolation from investment in the other fuel and power industries.
I suppose that when we have the White Paper in the autumn—perhaps at the end of October or in November—and a statement on fuel and power policy, we shall then have the procrastinating tactics of the Leader of the House denying us time for an adequate debate. We have no assurance, and we never have had any assurance, that we shall be given a reasonable amount of Parliamentary time in which to debate this important issue.
Tory Governments over 13 years—and the right hon. Member for Easington alluded to this—almost annually furnished time to deal with the report and accounts of the National Coal Board. Not once has that been done under a


Labour Government, notwithstanding that the coal industry is the sacred cow of Socialism. It is dereliction of duty on the part of the Treasury Bench, which treats with utter contempt the views of the 40 mining Members seated behind it.
The right hon. Gentleman the Member for Easington found exactly the correct form of words when, at Question Time on 4th July, he asked the Minister of Power:
Is he aware that the mining community is almost in revolt against the Government?"[OFFICIAL REPORT, 4th July, 1967; Vol. 749, c. 1536.]
He would have been more accurate if he had left out the word "almost". The members of the mining community are utterly in revolt against the Government. They have no confidence whatever in the present intellectualism of the fuel and power Ministers and the members of the Front Bench, who have never soiled their hands in a coal mine. Perhaps it would have been better if the hon. Member for Barnsley (Mr. Mason) had been made Minister of Power, for then at least the coal mining lobby opposite would have had a miner in control who understood their problems.
So little does the Minister of Power understand the problems of the mining industry—let alone the Leader of the House; he does not know the difference between a lump of coal and a can of oil—that I propose to quote him once again. [AN HON. MEMBER: "When were you a coal miner?"] Mr. Speaker, an hon. Member asks: when were you a coal miner?

Mr. Speaker: Order. I should like to answer the question of when I was a coal miner, but let us get back to the debate.

Sir G. Nabarro: I do dislike these interruptions, which are putting me off my stride.
The reason why the coal miners opposite have no confidence in their own Front Bench is easily recognised by what the right hon. Gentleman said, as reported in the Financial Times on 12th June:
Mr. Richard Marsh, the Minister of Power, said at the Northumberland Miners' Gala at Bedlington at the weekend: 'Our coal mining industry depends entirely on our ability to

increase output and reduce prices'. But, he added: 'We have had a rough time, but now the future is very rosy.'

Mr. Marsh: Mr. Marsh rose—

Sir G. Nabarro: I shall give way in a moment. The right hon. Gentleman has occupied a disproportionate amount of time, but I shall give way when I have finished the quotation.
This was immediately contradicted by Mr. Will Paynter, Secretary of the National Union of Mineworkers,
who said the changes taking place in the industry had destroyed the miners' faith in nationalisation.
That was underlined by the right hon. Member for Easington this evening. The faith of the miners in nationalisation is utterly destroyed. It is far worse when a Minister talks about a rosy future. What is this £50 million wanted for—the rosy future? No, the £50 million is wanted for the extra stocking of coal.
The right hon. Member for Caerphilly almost put his finger on it. He approached the problem, but did not quite quote the correct figures. He ought to have said that on 1st July, 1967—I quote from the Ministry of Power Weekly Statistical Statement, undistributed stocks of coal were 25,089,000 tons and distributed stocks 15,698,000 tons. A phenomenal total of almost 41 million tons of coal is now lying on the ground. Sales are declining and this huge volume of unsold coal has to be financed.
Today is only 18th July. Coal stocks will continue to rise, distributed and undistributed, until the onset of the New Year and may well reach the phenomenal figure of 60 million tons unless one or two things happens. Either there will be a sensational increase in the demand for coal, which I do not believe we can foresee in the early future, or there will be a sharp diminution in the output of coal, which equally well I do not foresee in the early future.
It may be that if we have another mild winter like last winter we shall be faced at the beginning of next year with the critical situation that there is 60 million tons of coal on the ground. What do we do then? Do we go on financing it out of public funds as we are doing this evening? The Minister should try to


face the prospects and not serve soothing syrup at miners' galas of a "rosy time" in the future, as he did at Bedlington.
The Prime Minister, last Saturday, at the Durham Miners' Gala, said that he would deal with the problem of the coal mining industry with economy and humanity? The most humane thing the Prime Minister can do with the industry is to tell them the truth and stop misleading them.
I listened to the Minister this evening forecast that in 1970 the output of the coal mining industry would be 140 million tans. That is two years hence. This year it will be probably be 160 million tons. Do not blame the Tory Administration for this. This is something which the Labour Party carries on its shoulders. When the Tories came to power in 1951 we were mining 212 millions tons of coal. When we went out in 1964 we were mining 200 million tons. Three years later we are mining 164 million tons. The really steep decline in the output of coal ha; occurred in the last three years under a Labour Government.

Mr. Lubbock: More credit to the Socialists.

Sir G. Nabarro: The hon. Member says that it is more credit to the Socialists. I profoundly disagree. I am one the side of the coal miners [Interruption.] I sit in my own home seat, where I live, South Worcestershire. I do not propose to offer myself for a mining seat this side of kingdom come. I remind the hon. Gentleman that, when I addressed the miners' conference in South Yorkshire, so pleased were they with my performance that they appropriated temporarily the silver miner's miniature lamp which was to have been presented to a miners' official and gave it to me to mark the occasion. [An HON. MEMBER: "Because they thought that the hon. Gentleman was dim."] But they had bought that expensive trophy to give to one of their officials. Did they think that he was dim? They took it from him and gave it to me. That was the only time a Tory Member has received a trophy of that kind from a coal mining audience.

An hon. Member: And probably the last time.

Mr. Speaker: Order. We are getting biographical. Will the hon. Gentleman come to the Order.

Sir G. Nabarro: I come back to the Minister's prognosis for the mining industry. He said that output will decline to 140 million tons by 1970 and, after the adjustments he hopes to make, it will be 155 million tons. We ought to tell the mining industry that the output of coal will be 100 million tons in 1975 if the present policies continue. But I do not want them to continue. There has been much talk this evening about nuclear power. I will not digress for the moment. It is equal to eight million tons of coal equivalent this year.
I would much prefer to deal with something which is much more flexible and which ought to be appropriated to coal much earlier and much more economically, namely, the amount of fuel oil being burned in electricity power stations. The Minister got away tonight with the disingenuous and disarming statement that he was increasing the coal consumption of power stations by six millions tons. He did not define the period and he omitted to tell the House the steady and remarkable growth in the consumption of coal at power stations.

Mr. McGuire: I wanted to interrupt the Minister about that.

Mr. Speaker: Order.

Sir G. Nabarro: The Minister gave way to me once on an important issue and I deferrred raising this matter. In 1960, 51·9 million tons of coal were consumed in power stations. In 1966, the figure had grown to 68·6 million tons. In 1965, it was 70 million tons. So in a period of six years the consumption of coal at power stations increased by almost 18 million tons. That was the natural growth based on the expansion in the demand for electricity which, over those years, was running at approximately 10 per cent. per annum arithmetical progression, or a doubled demand in a period of 10 years. There was a 33⅓ per cent. increase in the demand for coal at power stations. Pari passu that, the consumption of fuel oil increased from 5·5 million tons in 1960 to 7·3 million tons in 1966 and is progressively increasing.
My case is that all the Seaton Carews and power stations strategically placed


on or very close to coalfields may burn low-grade bituminous coals with a high ash content more economically than burning imported fuel oils. The first thing that the Minister should do to accentuate the demand for coal is to use his influences to switch from fuel oil power stations to coal power stations.

Mr. Edwin Wainwright: Mr. Edwin Wainwright (Dearne Valley) rose—

Mr. Speaker: Order. The Chair cannot prevent interventions, but I would remind the House that interventions prolong speeches and many hon. Members wish to address the House tonight.

Mr. Wainwright: I am sorry to have to intervene, Mr. Speaker. But over a period of years many hon. Members opposite have tried to get the Government of the day, including the present Government, to remove the tax on oil. Would the hon. Gentleman say what part he takes in this issue?

Sir G. Nabarro: It is historically a fact—and I invite the hon. Member to go to the Library and look it up—that when the tax on fuel oil was introduced in 1961 by my right hon and learned Friend the Member for Wirral (Mr. Selwyn Lloyd), who was then the Chancellor of the Exchequer, I divided the House against him from the Tory side on the grounds that I am enunciating tonight. I took only one Tory Member with me, my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop). I took two Liberals with me and four Socialists. But I divided the House against the tax on fuel oils. I noticed the Motion in the name of hon. Gentleman on the Order Paper of 17th July, which precisely gives effect to the policies that I have been enunciating tonight.
There is a second reason why I do not think that we should go on with a policy of increasing consumption of fuel oil in power stations. Surely the international oil situation, though there is plenty of oil in the world, ought to give us a great deal of cause for concern today. With the Suez Canal blocked, all Arab oil cut off, on the eve of petrol rationing in this country on 1st October, with all the petrol coupons printed, surely we ought to diminish, where it is practicable and economic to do so, our dependence on

imported oil. [Interruption.] I do not know why the hon. Member for Dearne Valley (Mr. Edwin Wainwright) should be so upset with me for pleading the cause of coal miners. [An HON. MEMBER: "It is the somersault that the hon. Member is doing which worries him."] It is not a somersault.
In 1954, when the Tory Government were obliged to increase the facilities for replacing coal demand by oil, we were desperately short of coal. That was why the emphasis was placed on oil by my right hon. Friend the Member for Sutton Coldfield (Mr. Geoffrey Lloyd), then the Minister of Fuel and Power, who launched the first nuclear power programme. That is why he placed the emphasis on oil in those days, and very rightly so. I am not standing on my head today. I am talking sound common sense in the interests of the coal industry.

Mr. Robert Maxwell: I am obliged to the hon. Member for giving way. Were the Minister to accept his advice and encourage power generation from coal, is the hon. Gentleman aware that the consequence would be that our export of power generation equipment would be hindered immensely? The chances of selling coal power generation equipment overseas are very poor indeed. For oil, the chances are considerable.

Sir G. Nabarro: The hon. Gentleman should either sit through a few fuel and power debates or learn about fuel and power economics. It makes no difference whatever to the machinery employed whether one burns coal or oil; the boilers, turbo alternators and other heavy plant are virtually the same. The hon. Gentleman should turn to his hon. Friend the Member for Bristol, Central (Mr. Palmer), who is a power generation expert. He will put him right on these matters.
We ought to diminish our dependence on fuel oil and increase the demand for low-grade high ash content coals, which are abundantly available, notably in the Durham coalfield. Were I the Minister, I should have no hesitation in saying that the Seaton Carew power station can operate more economically on coal, albeit only marginally, than on a nuclear basis.

Mr. Lubbock: No.

Sir G. Nabarro: The hon. Member is entitled to his opinion. I know more about these matters than I gain from listening in Select Committees.

Mr. Lubbock: I doubt it.

Sir G. Nabarro: I come now to the views of Lord Robens, which have figured prominently in the debate. It is an interesting situation that Lord Robens is now in head-on collision with his own Minister. Though we are denied the whole of the fuel and power policy statement until October—I shall not transgress the bounds of order, Mr. Speaker—the Minister opened his speech by saying that we were now switching from a two-fuel to a four-fuel economy, the four fuels being coal, oil, nuclear fuels and North Sea gas.
In the Financial Times of Friday, 7th July, under the headline, "Lord Robens attacks the economics of the madhouse", there was this report:
The decision to use natural gas in power stations was yesterday described as being the economics of the madhouse by Lord Robens, chairman of the National Coal Board, in a speech to the annual conference of the National Union of Mineworkers. He also attacked the Government's decision to press ahead so quickly with the nuclear power programme".
Under the Statute, the Minister appoints the Chairman of the National Coal Board, who is required to carry out Ministerial policies. It is a nice constitutional point whether we can countenance having the Chairman of the Coal Board or the chairman of any other nationalised industry attacking publicly the policies of the Minister who appoints him. It is a nice constitutional point how long this sort of thing can be tolerated. One of two events must happen—either the Minister "fires" Robens or Robens hands in his own resignation.
We cannot have a situation in which headlines in national newspapers tell us,
Lord Robens attacks economics of the madhouse
when the "economics of the madhouse" are the policies of the Minister who appoints Lord Robens. I shall raise that matter again in the autumn.

Mr. Eadie: Mr. Eadie rose—

Mr. Speaker: Order. I remind the House that many hon. Members wish to speak in tonight's debate. Interruptions

prolong speeches, and I want there to be a fair share for every Member in the House tonight.

Mr. Eadie: I appreciate what you say, Mr. Speaker. I have sat here since the beginning of the debate, and I am prepared to stay all night if need be, because the subject is so important. I wanted to ask the hon. Member for Worcestershire, South (Sir G. Nabarro) to be fair in his reference to Lord Robens. He quoted only part of what he had said. I shall have something to say about the Minister, if I catch your eye, Sir, but I am sure that the hon. Gentleman did not mean to be unfair to Lord Robens. In the same speech, he went on to say that my right hon. Friend was, in his view, the first Minister of Power for some time to make a genuine attempt to balance the rival claims of the various fuels and to provide the nation with cheap energy in the long run.

Mr. Speaker: Order. It is just that sort of lengthy intervention which may prevent the hon. Gentleman from making a speech later in the debate.

Sir G. Nabarro: It was only for reasons of brevity that I did not quote Lord Robens at length. [Interruption.] Interventions from the Treasury Bench by non-Power Ministers are an unaccustomed feature of power debates. I have a full transcript of Lord Robens' speech in my hand, but I did not wish to quote from it at length. I have marked off carefully that form of words which I should be unduly disputatious if I quoted:
I must pay tribute to Dick Marsh for this imaginative step.
There is nothing imaginative about it. Tory Ministers did it for 13 years. I do not want to quote the whole speech. I have raised, and shall raise again, pursuing by Parliamentary Questions and other devices available to me, the question of the absolute contradiction in major matters of policy between the chairman of a nationalised industry and the Minister who appoints him.
Tonight, I have no alternative but to support the Order calling for an additional £50 million, not on grounds enunciated by the Minister, with the circumlocution which attended his speech, but for a very simple, straightforward, honest reason. Stocks of coal are 25


million tons undistributed and 15 million tons distributed, making 40 million tons in all. From its existing finances and working capital the Coal Board cannot finance increases of those undistributed stocks on the scale we have witnessed in the past few months. It is for that reason that the Coal Board wants the extra money, and if the Minister had said that as shortly as I have said it he would have commanded a great deal more respect and support in the House.
I defer until the autumn my more censorious comments on the Minister's behaviour in these important fuel and power matters. I largely have the same fuel and power philosophy as the right hon. Member for Easington, for whom I have a healthy regard. At least he is an honest and patriotic creature. He said tonight that the miners hoisted the flags at the colliery pitheads on 1st January, 1947, to symbolise the onset of nationalisation, but he concluded by saying that he recognised that nationalisation had failed. Of course it has. [AN HON. MEMBER: "He never said that".] I shall argue that with him later, in the autumn, when we have our fuel and power policy statement. In the meantime, I advise the House to support the Order to finance unsold stocks of coal—unsold because the Coal Board is not good enough at selling coal.

12.58 a.m.

Mr. Ron Lewis: I hope that my hon. Friends will not think it impertinent of me to intervene in a debate on coal when I represent a city. But the City of Carlisle and the County of Cumberland go hand in hand in most matters, and during the past few weeks I have had the opportunity of discussing with many coal miners in Cumberland certain aspects of the Government's fuel policy. I think that I should also say that I worked in the coal mines of my native Somerset and in Derbyshire, the county of my adoption, for a number of years, until I became redundant through no fault of my own. I shall accept your advice, Mr. Speaker, by probably making the shortest speech in the debate.
I would put in a commercial plea for the County of Cumberland, and I hope to impress upon the Minister that the Cumberland coalfield must not be allowed to die. We have made a great

contribution in the past. At the moment, we have only three remaining pits in full production. But I am delighted to report that those three pits, as a result of a recent spurt, have increased their output over and above what was foreshadowed by the National Coal Board. Coupled with that, the three pits have made a profit. The profit for the Haig pit was about £46,000, equal to 5s. 11d. per ton, and the Solway pit made a profit of £70,000, equal to 25s. 8d. per ton.
One of the tragedies as I and the miners in Cumberland see it is that there is no recruitment taking place for the Solway coal mine. It should be borne in mind that in West Cumberland we have a very high percentage of unemployment. In certain parts it is as much as 10 per cent. One of the problems is that there is no recruitment for some of the pits. In one pit recruitment is confined to craftsmen and juveniles. But the three pits are producing more tonnage now than was produced in the first quarter of 1966 when they had helping them other pits which have since closed.
One of the problems is stocks. In June, 1966, we had in Cumberland about 900 tons of deep-mined coal in stock; today, there is about 46,000 tons. In June, 1966, we had 8 tons of opencast coal stocked; today, the figure is 33,000 tons. I hope that the Coal Board and the Government will get down to the problem of the marketing of coal. In Cumberland, we are feeling the draught of a drop from 10,000 tons to 6,500 tons in demand as a result of the United Steel Company taking less coal. I suggest that that can be reflected in various parts of the country.
Finally, I ask the Minister to impress upon the Coal Board the importance of spending some of this money in two pits in Cumberland. First, with regard to Solway pit, I am advised by experienced miners that if an 80-yard drift were begun the life of the pit could be extended by years. With regard to No. 10 pit, the men have given an undertkaing that if man-riding were introduced—taking men from the shaft bottom to the coal face—production could be increased by about 10 per cent. I ask the Minister in all sincerity to look at this aspect and to impress upon the Coal Board the need to keep our Cumberland pits open so that


they can in future make the contribution to the fuel policy that they have done in the past.

1.5 a.m.

Colonel C. G. Lancaster: The hon. Member for Carlisle (Mr. Ron Lewis) told us that he would speak with brevity and indeed he did. I do not think that he need apologise for confining himself to the problems of his part of the country, for he did so with competence and sincerity.
I would like to talk about what the Minister has said, but before I do so I would like to indulge in a look-back on the industry. I do so particularly because yesterday there was an article in The Times on the main problems of the coal industry and a great deal of what was said ranged around a pit which has been part of my life and my family's life for something like 100 years. It has now, inevitably, been closed down, but I still feel some remorse.
There was a picture of Mr. William Fletcher—"Bill" Fletcher—who has played a prominent part in the Nottinghamshire industry for many generations. Fletcher is a Lincolnshire name. The family came down from Lincolnshire and they have been good colliers. Now "Bill" Fletcher is redundant and I think that I know a little bit about how he feels.
A number of hon. Members have shown emotion tonight and it is understandable if I indulge in some emotion myself. I hope that they will recognise the reason for my doing so.
The Minister has made a very important statement tonight. Many of us had been impatient that he should do so, but one must recognise that he was faced with many matters that had to be resolved, some of which seemed conflicting to one another. Although we were impatient I am glad that he has said something that we can get our teeth into. He said that he looked to 155 million tons as being the production from the coal mines. I wish that he had accompanied that by "chancing his arm" in another direction. Although he said that he hoped there will be production of 36 cwt. per manshift in the near future, I wish that he had had a go on how he saw costs coming down.
If we are to discuss this matter rationally and objectively we must recognise that coal will prosper and remain among us only if it remains competitive. I wish that he had had a shot at it. I shall do so.
Some time ago I made an attempt to estimate what part coal would play in our energy requirements. I am not presenting this with hindsight, but I was within 5 million tons of what the Minister said. I said 160 million tons and I will give my reasons for saying that. I give, first, a qualification in regard to that 160 million tons. It will be enormously conditioned by the new organisation which Lord Robens has set up in the industry. The right hon. Gentleman the Member for Easington (Mr. Shinwell) is no longer with us, but whatever we may say about the past there is little doubt that what we did in 1947 was a very hurried arrangement. The system under which we nationalised coal would not stand up to the strain of a buyer's market. It got past until 1958 because we lived in a seller's market and its imperfections were not so obvious that attention was drawn to them.
Both the Conservative and Labour sides must take their share of the criticism that little or nothing was done to have a second look at them. By 1958, the gaps in the system were obvious to everybody, yet almost a decade went by before anything concrete was done. It is to the credit of Lord Robens that he grasped the nettle and embarked on a massive scheme of devolution and rationalisation. Nothing was said by the Minister about that, but I put a great deal of emphasis on it.
If the National Coal Board presses on with that scheme, as Lord Robens claims that it will and as I have little doubt that it will, I believe that we could see quite large economies in the cost of producing coal. I hope that hon. Members opposite will give me some credit for having a long experience of the industry. I speak with a considerable sense of responsibility when I say that it is possible to achieve this and that the nub of the matter is whether we can produce enough cheap coal to enable it to compete reasonably with those other three sources of energy to which the right hon. Gentleman referred. I believe that it is possible and I can only hope that it will happen.
The other side of the medal is that if we do not hold either 155 million or 160 million tons a lot of things which will not be in the interests of the country will supervene. This is our only indigenous fuel and we have a big bargaining power in having it. We are at risk at the moment over our requirements for oil. We are also very much at risk with our requirements for imported methane gas.
I am concerned with the technology going on at Canvey Island where installations for storage of gas are growing on a massive scale. At the moment, there is chaos there. No ship has put in for a month. It may be said that this is a temporary situation which will not happen again. I am by no means certain that we can look to the future with that degree of confidence. If, at any time, we allow our coal industry to fall to a level from which it would be difficult to recover, we are giving hostages to fortune and we would be unwise not to recognise that.
The industry itself has lived in a condition of uncertainty for many years. Morale both of men and management has been affected. Indeed, the whole image of the industry itself has become dimmed. In many ways tonight is a very important occasion, because the Minister has produced at least a bottom on which the industry can settle down for some time.
The risk we have been running is not that men would leave the industry for other occupations—that is inevitable—but, even worse, that we would not recruit the right type of young technologist by whom alone we shall bring about the improvement and recovery of the industry which I believe to be possible. So long as that uncertainty existed, that threat was the greater and to that extent we must be grateful that at last we have got from the Minister a figure with which many of us may not agree, but which gives us some confidence that we have reached a bottom from which it may well be that we shall be able to advance.
An hon. Member interjected earlier that we were ignoring what was happening in the United States and Russia. I think that in some ways we are a little unwise to do so. A few years ago,

America was producing 380 million tons a year; now it is up to 570 million tons and the target is 600 million tons. Russia's target is 1,000 million tons. Of course, 40 per cent. of American coal production is from strip mining but it is perhaps surprising how much coal is being produced there from quite thin seams.
Admittedly, they are working at shallower levels, and they have better roof and floor conditions. Even so, with all their natural advantages, with masses of natural gas, hydro-electricity and oil, they recognise that the future is uncertain, and they are pressing ahead with coal production. The Russians are doing much the same. I know a little about the Russian coalfields. They have not perfect conditions everywhere, yet they have come to the same conclusion. We cannot think in terms of 600,000 or 1,000 million tons, but we should be unwise if, in our turn, we did not look relatively to the importance of this indigenous fuel.
I am trying not to allow sentiment to sway me in this matter. I am looking at it quite objectively. I believe that, when this scheme of rationalisation takes place, when we get production from the most efficient pits, when we have the benefits from a rapidly developing technocracy, when we take advantage, by means of devolution, of allowing the men at the periphery to do their job as they alone know how to do it, and when we get away from the idea of running the industry from London, it will be possible to see an improvement of between 15s. and 25s. in the cost of producing coal. If we do that, we shall get fractionally below the figure of 4d. a therm, and that is a very competitive figure. If we can produce coal at anything under 4d. a therm, it remains a very competitive fuel.
Equally, we are inclined to think that the whole of this production must take place in the East and West Midlands and Yorkshire. I do not agree entirely, because transport must come into any calculation of production costs. It would be unwise to imagine that it would be sensible to take coal from the East Midlands to Scotland, for example. There could be pockets of production in Scotland, South Wales and Durham. Fields like Lanarkshire probably have seen the


end of their lives, but, however much we rationalise, it would not be wise to cut out those parts of the, country where we can take the best pits and produce economically, and attempt to do it all from one or two main areas.
I congratulate the Minister on having come out with a figure. We have all been waiting for it, and certainly the whole coal industry has been. Whether or not it is the figure that we hoped for, it will give some confidence to the industry that there is a firm figure. If, on top of that, we do what I hope and rationalise and devolve in the manner that Lord Robens has claimed that he intends to do, it may be that in the mid-1970s there will be a recovery of the coal industry. It is not beyond the wit of man to think so. I do not agree with those who say that production will drop to 100 million tons in the 1970s and less in the 1980s.
It may be that this element can compete, if it is produced under conditions as near perfect as we can get them and with the highest available technology. We have the best colliers in the world, and some very fine technologists. I think that the future of the industry is by no means as desperate as some speakers have implied.

1.19 a.m.

Mr. Thomas Swain: I listened with great interest to the hon. Member for South Fylde (Colonel Lancaster), and I sympathise with his understanding of redundancy. After all, as a coal owner, he was made redundant after 1st January, 1947, so he can appreciate the position of a man who is made redundant today.
However, his redundancy and that of a man at the coal face or pit top today are two rather different matters. A far different golden handshake was and is still being handed out to the old coal owners from that being handed out to the man who is made redundant today.
Another point of interest in the hon. and gallant Member's speech was the reference to my hon. Friend's interjection about Russia, America and Poland. Of course, the mining industries are prospering in those three countries and in East Germany, where the opencast working is going ahead by leaps and bounds.

Obviously, there is a fundamental difference between those countries and us. They have expanding economies. We have had a stagnant economy for the past two decades and, the way we are going, we will have a stagnant economy for the next decade. That is what worries me. How the devil can the coal industry increase output and sell its coal if the overall economy of the country is not expanding?
The National Plan envisaged a 4 per cent. expansion. The man who presented that plan must have dreamed about this. Then, when he woke up, only about three months afterwards, everybody had forgotten all about it and we were back in square one, where we started.
If the hon. Member for Worcestershire, South (Sir G. Nabarro) claims to be a friend of the miners, as an ex-coal miner I say, "God shield us from our friends."

Sir G. Nabarro: "Protect us".

Mr. Swain: It needs to be a shield that can withstand a nuclear bomb. I have never heard such hypocrisy and cant in the House of Commons as has come from the mouth of the hon. Member tonight. After some of the things that he has said in the House about the coal mining industry, the same thing ought to happen to him as happened to Lot's wife next time he turns round.
I have the greatest sympathy with my right hon. Friend—he may not think so, but I have—as Minister of Power. I share the sympathy of my right hon. Friend the Member for Caerphilly (Mr. Ness Edwards) with the Minister. He has a stupendous task in operating the various forms of power with all his other attendant features, such as steel.
During my time as a Member of the House, we have had various Ministers of Power. My right hon. Friend has tried to look in a modern sense at the mining industry. He has at long last come along tonight with a figure. I am far from satisfied with the figure, because I think that it is optimistic. If our assessments of the situation are anything like correct or the assessments of experts who have been writing in the newspapers are anything like correct, my right hon. Friend's figure tonight is very much up the creek, nearly as much up the creek as the Plan for Coal in 1955.
That plan envisaged that we should need to produce 140 million tons of coal a year by 1970. Capital expenditure was sunk in the industry on which the industry still has to pay the burden, regardless of the relief so graciously given by the former Minister of Power in the 1965 Act, which has to be borne by the industry as a consequence of the planning of the 1955 Plan for Coal.
I hope and trust that the figure given by my right hon. Friend tonight is not overrated and, consequently, capital expenditure has to be borne by the industry and then the plan fails, as the 1955 plan failed, and the money goes down the drain, as the 1955 money had to go.

Mr. Marsh: The question of the figure has been raised several times. There is, of course, the important qualification that it is very much dependent upon the ability of the industry to get the increased output per manshift that the Board thinks that it can get. Clearly, it can be sold only on the basis of the expected increase in productivity.

Mr. Swain: I understand that, and I heard my right hon. Friend say that in his speech, but I thought it was important for him to repeat what he said about the possible flexibility of the figures in the event of the industry not being able to produce coal at the rate he envisages in competition with other fuels.
I would like to quote what was said in the House by the former Member for Houghton-le-Spring, now Lord Blyton, speaking on behalf of the Labour Party when it was the opposition. Speaking from the Front Bench, with the whole authority of the Shadow Cabinet and the party behind him, he said:
Our position is clear. We believe there can be no realistic plan in industry unless there is a policy of expansion and full employment and the responsibility for this rests clearly on the Government. Such a policy is necessary to accommodate the technological changes that take place. The Government should stimulate production in other basic industries, and their duty is to maintain full employment."—[OFFICIAL REPORT, 20th November, 1962; Vol 667, c. 1113.]
Where have those great Socialist ideals gone since we took over as the Government? If I were a preacher, I would use those two quotations as a text and preach a sermon which would go down in history. Productivity is stagnant, and un-

employment is at its highest figure since the war at this time of the year. This is not very good praise, and in relation to the statement by Lord Blyton, it is a contradiction in terms.
Where is the National Plan, so forcefully introduced by the Department of Economic Affairs, and what about the section pertaining to the coal industry? What worried me about the Plan, and what worries me about the future, is that the Government expect a 3 per cent. growth in the economy. This will inevitably mean at least a 2½ per cent. growth in our energy demands, and yet, with all this planning for a 3 per cent. growth in the economy, the coal industry is to be run down to what the Minister admitted tonight is an unknown figure.
We are the only country in the Western world which is running down its coal industry at the same time as planning for an expansion of 3 per cent. in the economy. Where is this 3 per cent. growth going? Is it going to natural gas, or to oil? Is it going to nuclear energy? It is obvious that none of it is going to the mining industry. These are the things which are worrying my hon. Friends and myself, and, above all, worrying the men and women in the mining districts.
I propose now to say something about the county which I represent as a miners' M.P. Incidentally, I am one of those union Members who carry out their union's policy. I do not think that interventions from beyond the Bar are in order, whether from Ministers or anyone else. Derbyshire is known as a grey area. I was at a meeting last night, and I came away with the impression that a grey area is an unknown quantity. No one could define it. Overall unemployment in Derbyshire is very low, but the fact that men under 40 are being driven away because of the closure of mines to other parts, particularly Nottinghamshire, shows that the county is being depopulated and will become a county of aged people. This is happening to one of our greatest coal-producing counties.
We cannot argue against closures because of exhaustion, but the Government and the Coal Board do not give sufficient thought to closures on purely


economic grounds. Such pits should be thoroughly investigated and their life extended at least until alternative employment is provided in the area to absorb not only the older men, the weak and the disabled, but also the young men who do not want to take up their roots from the county of their birth. A Labour Government cannot and should not continue to force these families to migrate. The miners have faced mass migration before—prior to the 1914–18 War and, with the consequent hardship, degradation aril privation, in the 'twenties and eary 'thirties, when miners came to the Midlands from Northumberland, Durham, Wales and Scotland.
That process is now being repeated, and—worst of all—for the same cause of economic determination and a lack of interest by the Government or the public to protect the miners against this terrible affliction. Figures in a recent report from Derbyshire County Council prove that, although on the fringe of the most prosperous coal mining area, the East Midlands, the county is a depressed area. In 1958, there were 43,000 miners in the North Derbyshire coalfield—excluding the South Derbyshire field and the area surrounding the centre of Europe, Swadlincote—and the figure had dropped to 36,000 in 1961, 30,000 in 1965 and only 26,000 today. Expert forecasts suggest that by 1968 it will be only 24,000 and by 1975, 18,000.
These figures prove that Derbyshire has suffered considerably from mine closures over the last few years. When I entered the House, in 1959, there were 11 large collieries in my constituency. Four of them have closed, one having become exhausted and three for economic reasons. The unemployment figures in my constituency are interesting. I will quote those which are most advantageous to my case—as any commonsense person would—to show that Derbyshire is not as prosperous as people think. In the centre of my constituency is Clay Cross. Unemployment in this area, which is served by the largest employment exchange in my constituency and which has a high concentration of Labour voters, is now 5·3 per cent. The unemployment rate elsewhere in Derbyshire is not as high, mainly because

of the migration about which I have been speaking.
Great strides forward have been made in the pit where I used to work, most of them since I left it. Just before I left the pit, with 1,300 men it was producing 28 cwt. per man shift. Today, with a complete turnover to mechanisation—which I hope will continue with even greater speed—it is producing 63 cwt. per man shift with 750 men.
Some people call miners Luddites. No industry has faced technological change in the same spirit as coal mining. There has not been one major stoppage since 1926, where 1¼ million men worked in the industry. Today, it employs only 400,000. I pay tribute to the N.C.B., under its Chairman, Lord Robens.

Mr. Michael Alison: Has any attempt been made by the Coal Board to move any of those unemployed miners to whom the hon. Gentleman referred further south, as part of the resettlement programme? If so, why has it failed?

Mr. Swain: Most of the men who are unemployed in the Clay Cross area are incapacitated through ill-health and injuries caused by working in the pits and for other reasons. Many pits in the area surrounding Clay Cross have also closed and it would be a difficult and costly business to transfer these men elsewhere.
As I pointed out in an earlier debate, many miners must now get up at 4 a.m. and travel 20 miles or more to work, whereas they used to get up at 5 a.m. and walk a few hundred yards to work. This extra travelling has added two and a half hours to their working day. Men can be transferred to pits within a certain distance, but we have almost reached the point when the men will not travel much further.
Our men, who have always been very tolerant, are at last saying, "We cannot travel 20 miles to work each day"—and that means travelling 40 miles a day. Many of my constituents travel 35 miles a day to work in a coal mine, getting up at four o'clock in the morning and getting home at four o'clock in the evening.
I urge the Minister to let us have the White Paper as soon as possible, so that this great industry of ours can plan according to a figure that I hope is within reasonable limits. When all is said and done, it was only on 20th November, 1965, that the then Minister of Power, answering an interjection from this side, said that if coal production went one ton below 170 million tons it would have a serious effect on our balance of payments. Perhaps the Minister will tell us what the adverse effect on our balance of payments would be if the industry were to produce only 165 million tons this year. It is the White Paper of 1965 that the mining and other energy producing industries have been working on, and we should like to have the present figures.
These are only a few of the things that worry us as miners' Members, and I hope that we shall get from the Parliamentary Secretary some figures, some understanding, and some promises. I might add, in passing, that the Minister said that he would agree to men over 55 years of age getting pensions at once, but every man who does that is an added burden on the industry. Will the Minister provide the money necessary for this step to be taken so that the industry itself does not have to take on this burden?

1.42 a.m.

Mr. Hector Monro: It is an interesting coincidence that in the Second Reading debate on the Coal Industry Bill in November, 1965, I followed the hon. Member for Derbyshire, North-East (Mr. Swain), and the difficulties that he and I then put to the House seem to have been exactly the same as they are today. As I said at that time, although I cannot in any way equal him in his great and personal knowledge of the industry I can follow him in the interests of the miners in my constituency.
I am sorry that the Scottish Minister, who was with us earlier, has been unable to stay because, as the right hon. Gentleman the Member for Caerphilly (Mr. Ness Edwards) said, the solution, if there is to be one, of the mine closures will be reached through the co-operation of the Ministry of Power, the Board of Trade and, in Scotland, the Scottish Office. All those Departments must take a close interest in the position.
I am trying to take a balanced view of power policy, because in my constituency I have a nuclear generating station and I wish that also to expand. I know that, in the end, the closure of the Fauldhead colliery is inevitable, not so much on grounds of the viability of the colliery but because the coal is no longer there.
I wish to put two questions to the Minister about the subsidy he is giving to the industry. I wonder whether this will make a substantial difference to the problem in Scotland where there is a differential price of approximately £1 a ton for coal for the electricity board, which makes a difference of about £4 million a year. This is having a detrimental effect on electricity prices in Scotland.
My second question concerns the large stock of coal above ground. It seems incongruous as one of the problems we have had in the last 12 months has been complaints by coal merchants that they cannot get the coal they want and the extreme difficulty they have with the Railways Board over the closure of coal depots in goods yards. The Ministry should take a much more active interest in helping the merchants in this problem.
My main point is the extreme concern I feel about the future of the miners, particularly in my constituency, when they lose their jobs through pit closures. The Government set out to deal with this problem in the White Paper of November, 1965. The Government proposed to provide special funds to accelerate the provision of alternative employment in industrial development areas mainly affected by the closure of uneconomic pits and to help to meet the social costs arising.
In paragraph 21, the White Paper said:
The Government will encourage the development of new industries in the areas affected, to give employment to miners who for one reason or another are unable to remain in the coal industry, and to maintain job opportunities for future school leavers.
That sounded encouraging, but nothing significant has happened. This is why the morale of miners in areas threatened with closures is deteriorating. I think particularly of the pit at Fauldhead, where 750 miners realise that probably in the not too distant future they will have no job at all.
The hon. Member for Derbyshire, North East rightly said that it is wrong to expect miners to have to travel great distances to work. There are two modern pits in the South Ayrshire field at the Barony and Killoch, which are within possible travelling distance, but there is a snag here. There will be more closures in South Ayrshire and by the time Fauldhead closes, jobs available in the new pits will have been taken up. If the men wish to stay in the industry, they will be forced to emigrate to the Midlands of England. As a Scot, I do not want that to happen. If miners cannot be given jobs in mining near their homes, a dramatic effort must be made by the Government to provide other employment in the area.
The most simple way of encouraging industry to expand into a difficult area such as this is by having a buoyant economy. We have not got one now. That is why it is difficult to attract industry into the advance factories which are being built in this part of Scotland. Two new ones will be completed in the autumn, but, despite having made valiant efforts, the Board of Trade has received no enquiries from would-be occupants. Even if industrial firms could be persuaded to occupy these factories, with 750 men unemployed two small advance factories would not be anything like sufficient.
The miners are left with three choices—to migrate to the South, to work at great difficulty in pits 25 or 30 miles away, or to welcome incoming industry. If the miners are forced to leave, they leave behind a community which has been built up since the war with a new housing scheme, a new school and other attractions. It is wrong that any Government's policy should result in these towns becoming depopulated and their residents migrating.

Mr. J. D. Concannon: I represent one of the receiving areas for these Scottish miners. I assure the hon. Gentleman that they and displaced miners from the North are settling down well in the new mining areas and that they do not have to travel 25 miles a day to their work. The colliery houses in the new villages are close to the collieries.

Mr. Monro: I thank the hon. Gentleman for his reassurance. I am glad that these Scots are settling down well in

England amongst their foreign friends, but I am sure that they would rather not have left Scotland. No one likes leaving his home.
This is why I believe that there must be a concerted effort by the Ministry of Power, the Board of Trade and the Scottish Office. Nothing I have seen so far encourages me to think that sufficient action has been taken. I have been to the Scottish Office and to the Board of Trade. They are aware of the problem, but I am not convinced that they are doing enough to counteract the tragic effects of this imminent pit closure in this small area. The unemployment figure in the area is already 9 per cent. Should the pit close, it will be 60 per cent. of the male working population. This would be a major disaster to the area and it is vital that action should be taken as soon as possible. Only by co-operation between the three Departments I have mentioned and an expanding economy will the difficulties caused by pit closures be solved.

1.55 a.m.

Mr. Robert Woof: I am very glad indeed to follow the hon. Member for Dumfries (Mr. Monro), if only for one reason. This is one of the infrequent opportunities that we have to discuss some of the vital aspects of the National Coal Board's affairs. I wish to emphasise strongly that if there ever was a time when my right hon. Friend the Minister of Power required an affirmative Resolution of the House to raise the limit of the borrowing powers from £700 million to £750 million, it is precisely now.
I wholeheartedly support the 'purpose of the Order. It is imperative that we should do so, in order to accomplish its usefulness by assisting the Coal Board to extract itself from its present trying situation. It has been made clear that many of us are anything but happy about the present situation in the coal mining industry, or its immediate prospects. We have felt the gloom for a very long time. It should, therefore, be abundantly clear that we regard these borrowing powers as essential to maintain the drive for increased production.
Unfortunately, one has to admit facts. Even although the Coal Board has made strenuous efforts, we have to face the


fact that each year has brought a diminution in the ability to establish a large market for the sale of coal. For anyone with so long an association with this great industry it is alarming to think of its consequent uncertainty. It has been thrown into perplexity by the effects of the changing pattern of consumption through the development of new sources of fuel and energy.
I now turn to the Order itself. My right hon. Friend has given us a detailed explanation of what it is about and how it will help to reshape the coal mining industry as a result of being subjected to a great number of vicissitudes. A great range of information is always required for satisfactory judgment. It would be a sad business if we were stifled for lack of vision, but I feel it is a spur by endeavouring to recall the measure of progress that has been made under nationalisation since January, 1947.
What comes unbidden to my mind is the position of the coal industry when it was controlled by private enterprise, and the shocking state in which it had been allowed to degenerate in trying to make as much profit as possible. I will not recapitulate all the details of those circumstances, but the experts acknowledged that the industry needed drastically reorganising and that its structure and methods of production would have to be planned. As a consequence, heavy expenditure and a large capital investment was made to bring the industry up to technical and mechanical standard.
That was in the years when production was needed to meet the almost insatiable demand for coal. We believed it to be the foundation of the country's prosperity, but today, instead of the kind of security that we imagined would be a feature of the coal mining industry under State control and ownership, we have an industry absolutely drowned with frustration, bewilderment and cynicism as to its future.
What did we expect when it was said that on the assumption of rapid and continuous growth, inland demand for all forms of fuel would exceed 300 million tons of coal equivalent by this year. That has, no doubt, been repudiated by subsequent events. But, fed by that hope and expectation, and acting on the best advice,

the Coal Board estimates its requirements for the purpose of borrowing powers and at the same time aims to find large sums of money from its own resources.
Although we have a nationalised coal industry, a nationalised gas industry and a nationalised electricity industry operating in an expanding energy market, the Coal Board now faces a deliberate and calculated contraction. These borrowing powers should be considered in that light, inasmuch as they will help the Coal Board in its major task of securing for coal a share in the energy market, a share which must be won by efficient effort, and which will best serve the life and interests of the nation.
It is in that context that I support the Order. I feel that we ought to support the Coal Board, for coal can play its part and make its contribution instead of being singled out to play a declining role. There have been criticisms of the coal mining industry and of the Coal Board. I do not object to criticisms, provided that they are constructive, but when they go to the point of discerning nothing but faults to discredit nationalisation, there is need to draw the line.
Lord Robens and the National Union of Mineworkers have pleaded for time to enable the industry to complete its modernisation programme, and they have advanced their claim to resist a further heavy cut in the coal production target. Whatever public money has been spent, with the valuable aid of the Board's borrowing powers, cannot be regarded as extravagant expenditure, especially when the Coal Board has been forced to take up arms in a commercial war. This is what these borrowing powers Orders are about. It is highly significant that the Coal Board has seriously tried to compete by providing means of increased production. The yardstick is output per manshift, and this has risen to a record of 39 cwts.
Management at the higher levels has been determined to provide the most advanced tools to produce coal at low cost. It may be that the more is accomplished the more remains to be accomplished. But those who have planned and worked to modernise the industry deserve every credit. After all, the secret of success lies in just that—what a man sets out to do welt It is such accomplishments


which have made Britain the most advanced coal mining engineering country in the world. Without the financial structure laid down in the nationalisation Act and without these borrowing powers, improved efficiency in the use of coal face machinery would not have been possible. Moreover, the moneys borrowed for new investment in ancillary activities is expected to enable expansion of output from the more highly productive collieries.
But that in itself cannot remove the disquiet felt at this critical period, for between now and the 1970s another 200 pit closures are expected, and the coal resources of many of them will be exhausted by that time. In the light of the reorganisation which is taking place, and to keep the future of coal in perspective, it is interesting to read what was said in an editorial in the Financial Times on 7th July last.
Referring to the process of streamlining the coal and gas industries, and to the commercial criteria of the gas and coal industries, it stated:
However anxious it may be to take advantage of the new discoveries, the Government must look at the situation from a wider point of view than that of the gas industry. There would be heavy costs, direct and indirect, to tear if the coal industry were to go sharply down-hill. These have to be taken into account when reckoning how much it is worth paying to protect it for a little longer.
Even though that stress is deliberately made, we do not regard these borrowing powers as protection. In these perplexing and critical times we recognise that coal no longer has the monopoly in the energy market, but some of the anxieties must be mastered and overcome. A great many of us firmly believe that it is not in the national interests that we should stand by and watch the coal industry become a shambles and drift towards chaos and disaster.
It is all very well to say that the impact of natural gas could be absorbed by the expansion in the demand for energy. We have been in an expanding energy market for years, but that has not even sopped coal from declining.

Mr. Albert Roberts: Does my hon. Friend agree that the power demand is not expanding enough?

Mr. Woof: Yes, I quite agree. That is part of my argument.
We know that the Coal Board has options to participate in licences held by Gulf Oil and Allied Chemical, and that it is also joining with another American enterprise, the Continental Oil Company. But we must try to view the energy picture as a whole. The discovery and supply of natural gas should be accepted as complementary to indigenous coal. It is a welcome addition to this country's natural resources, which should together form a basis of fuel policy by making possible restrictions of oil imports and the cessation of imports of natural gas. Such a policy would relieve the country's balance of payments and dependence on imported fuels.
But no one can safely say how big the North Sea gas field is. No one doubts that results have been achieved more quickly than was hoped. It is expected that gas will be produced, as my right hon. Friend the Minister said, at the rate of at least 2,000 cubic feet a day by the 1970s, which represents 25 million tons of coal equivalent a year. But I have seen it stated that the supply might be used up in between 25 and 30 years. If that is so, North Sea gas is no answer to our permanent fuel problems.
In this light, it is important to know what measures are forthcoming. In the meantime, a great deal has been done. The Coal Board has developed a capital-intensive and highly automated industry to make it viable. Today, nearly 87 per cent. of all British coal is won by power loaders and hydraulic supports. That can be classified as the strategy to meet the grave competition in the energy market.
It is important to bear in mind that the biggest customer of the Coal Board is the Central Electricity Generating Board, on which the Coal Board was relying to take 100 million tons of coal a year in the 1970s. It now looks as though nuclear power will be the coal industry's biggest rival in the electricity generating market in the 1970s. This still has to be proved.
The first nuclear power programme amounting to 14 million tons of coal equivalent has certainly not been competitive on price with modern coal-fired plant. Now the nuclear power chiefs say that the second nuclear programme will be based on the advanced gas-cooled


reactor and claim that it will produce electricity at a price 10 per cent. cheaper than the latest conventional station. If the nuclear forecasts are correct—and at this stage they are only forecasts—it means that the coal industry, to be competitive, would have to put coal under the power station boilers at 3d. a therm, which is about 15s. a ton less than now.

Mr. McGuire: I am interested in this question. I do not want to prolong the proceedings, but surely my hon. Friend is aware that following Questions in the House the estimates for the A.G.R. have been revised upwards and now the price is 25 per cent. dearer than was forecast only two years ago.

Mr. Woof: Yes. If my hon. Friend had been a little patient, and had waited, he would have found that I agree with him.
We know that the first nuclear power programme was prepared in the 1950s at a time when there was a shortage of coal. In 1957, the programme for 5,000–6,000 megawatts was laid down for nuclear power, but later, in 1960, doubts arose about the economics and it was decided to slow down the programme, putting back the completion date until 1968, and to limit it to 5,000 megawatts. When this programme is completed it will displace 14 million tons of coal a year and will render 28,000 miners redundant.
This is anything but satisfactory to the Coal Board. Studying the economics of the matter before anything passes beyond a certain definite and apparently final stage, I am glad that the Coal Board is now represented on the working party comprising representatives of the C.E.G.B. and the United Kingdom Atomic Energy Authority.
Facing the economic struggle, it has been a serious exercise for the Coal Board. It has never escaped from its responsibilities to bring down the price. The industry is already producing 12 million tons of coal under 3d. a therm, 70 million tons under 4d. a therm and 126 million tons under 5d. a therm. This is the result of the continuous drive to raise the levels of output and productive efficiency throughout the industry. It is because of these factors that those

of us who represent constituencies in County Durham look with trustful equanimity on the Coal Board trying to make the best use of its resources.
Since vesting day—January, 1947—until 31st March this year £120·9 million has been spent in capital expenditure in the Durham coalfield. During the last three years £18 million has been spent. This has been necessary in order to concentrate production on reconstructed pits. These have a long life and are a viable proposition in the working of remunerative seams. The manpower has been drawn from the closure of exhausted and difficult pits, but over the last few years this streamlining and reorganising has made great demands on the men and managements. Many of them have been directed to one pit after another on account of closures, and with awkward shifts and long travelling it has made working life intolerable.
I must also mention that, in trying to solve the problems of redundancy, thousands more volunteered to work at collieries in the Midlands and Yorkshire and even in South Wales, thereby relieving the pressure of pit room. In fact, the manpower in County Durham has dropped from 110,000 in 1947 to 53,000 at the present time. While we have always argued that the transition was being pressed into too short a period, we are also aware that the Coal Board's revenue must be sufficient to cover day-to-day costs of production and to make provision for depreciation and for financing of capital investment.
This enabled many of the reorganised mines in the North East coalfield to supply power stations in the Thames Estuary and the great industrial combine of Ford's at Dagenham. All this occurred in spite of the fact that oil has made serious and progressive inroads into the Board's markets. Incidentally, sale of oil in markets where it competes with coal increased from 16 million tons equivalent in 1957 to 50 million tons at the present time.
I do not think that it would be inappropriate to say that the Coal Board deserves a tribute for meeting this challenge of salesmanship. While that is part of its success, it is worth watching what one might call the dread forces of


progress that we regard the idea of the Central Electricity Generating Board building a nuclear power station at Seaton Carew as a change of the utmost gravity.
It is, therefore, highly relevant to know whether the Government will allow a nuclear power station to be built in County Durham. I think that it may be agreed that whenever a man creates anything new he pursues it. But such a decision is crucial to the coal industry in County Durham. Our justification for a coal-fired power station is based on people's livelihood, for whom we have a strong moral, social and economic responsibility, and whose future could be seriously jeopardised. I ask the Government to seriously consider whether it is economically right for the well-being of a whole community to be sacrificed.
I have been looking back at the records and I see that on 14th March, 1963, the then Prime Minister, Mr. Harold Macmillan, stated in the House that the building of a power station in County Durham was regarded as important from two points of view: chiefly, in the first instance, for the use of Durham coal and the need of a further power station for the needs of the area. It was accepted that that would become necessary. I agree that circumstances may have changed, but no decision should be taken which will gamble with the livelihood and future of all those who are dependent upon the coal industry.
What is vitally important is that there is not much prospect of alternative employment. Men do not go down the mines because they like it. They have no other choice. We are tired of appealing for alternative industry. We read with great interest the report on coal finances for 1965, in which the Government promised to set aside special funds to provide alternative employment for these areas that were to be affected by pit closures. There has never been a penny spent in my area and I do not know of any other.
The men in the industry and their forebears have contributed in large measure to our great industrial progress. If the Government allow a nuclear power station to be built which will displace a further 8,000 men they will be travelling on a dangerous economic road.

2.20 a.m.

Mr. David Crouch: It is not my intention to keep the House long. I wish only to make a short intervention, but not because the hour is late or because I consider this subject to be unimportant. The subject which we are discussing at this late hour, and have been discussing for four hours, is one which has excited emotions among all hon. Members who have spoken and there are still many who wish to speak.
The reason for my intervention is that I have a modern pit in my constituency. It has not been mentioned so far this evening, but there is a small extention of the coalfield in Kent. I wish to make some reference to the situation in the Kent coalfield.
I followed the Minister with great interest as he went through his lengthy speech and his calculations and plan for the future. I will look forward with greater interest to the time when he tells us his national fuel policy. I believe that it is essential that the coal industry and all the other fuel industries should know soon the whole nature of the Government's national fuel policy. The emotions we have heard in the House tonight have been not because we are so concerned with the economics of the subject, but because of the human problem that is at stake in the changes which will be brought about by the Minister's fuel policy in the future. It is essential that the Minister bear in mind that management and men must know where they stand long in advance, as far in advance as is possible.
I listened with great attention to the sincerity of the right hon. Member for Easington (Mr. Shinwell), who spoke from such long experience, having seen great changes in the industry and having had such close association with miners. I, too, have had close association with miners. During the war, I had the honour to serve in a Scottish regiment of Fifeshire miners and to go abroad with them and I never found a greater set of men in my whole experience until I paid my first visit down my own pit in Canterbury.
There I found no sign of any feeling of Luddite-ism. Instead, I found a remarkable spirit among working men in conditions which, although I have worked in factories, I know simply cannot be


compared with working on the surface and where the rules of safety such as one demands in a factory are just not possible at the pit face.
These men have a wonderful spirit, the sort of spirit we talk of in the House when we talk of this country being in some danger economically. I do not wish to draw on the emotions of the House by saying so, but I came from my own pit inspired and encouraged by the people I met. It is because this is a human problem, because men want to know where they stand, because they give of themselves in hard work and sweat, that they want to know where they stand for their wives and children in the future. They are making a great contribution to the nation's economy and they deserve from the Minister the same great care that he has given to the economic aspect of his vast problems. They deserve a very big and special care for their future.
I hope that we will not hear too much of the phrase of "running down" the industry. I welcome the warnings that have been given in some speeches that coal still can make a major contribution to the reconstruction of our economy. I remind the Minister of the Kent coalfield. There has been a great investment there in modernisation. The four pits employ about 5,000 men. Productivity has increased enormously, but still we wait for those pits to make a profit. I am confident that perhaps in another year we shall see them making profits. But there is concern among both management and men in those pits about how long they will be allowed to continue in the Coal Board's overall plan. There is a question mark hanging over them.
The pits make an important contribution to the local economy in East Kent. The pit workers are high wage earners, and a human factor which must be remembered is, that should there be a decision at some time in the future to close the Kent coalfield, the mine workers are neither men of Kent nor Kentish men. They come from Durham, South Wales, Scotland and Yorkshire. They come from mining families, and are working as miners. If there should be a closure in Kent, what can the Government and the Coal Board offer miners who are declared redundant, because it is not an industrial

area? I hope that the Minister will bear in mind particularly this small thought of mine about 5,000 very important people.

2.27 p.m.

Mr. Harold Finch: We are dealing tonight with proposed borrowing powers for an industry which has helped build up the industrial prosperity of our country. In years gone by, miners have produced more and more coal to meet an ever-increasing demand. This country became the workshop of the world, and it was built largely upon coal.
Times have changed, and other forms of energy have come into being. The pattern of business has changed. The miners are facing the changing position with the same fortitude, patience and courage as they displayed years before, when coal was in high demand. When the history of our times comes to be written, men and women will marvel at the attitude of the miners. Mention has been made of the activities of the Luddites in years gone by, but there has been no Luddite atmosphere created among miners by the enormous changes which have taken place in the last ten years. In that time, the mining industry has lost 300,000 men, and 50,000 in the South Wales coalfield alone.
There has not only been a loss of manpower, because methods of production in the industry have changed. It is 90 per cent. mechanised today. New techniques have been brought into operation. That has given rise to new methods of wages. My hon. Friends know what an exercise it must have been in changing wage rates with changing conditions of working, but this has been done, and it continues to be done, by the union and the Coal Board, which have faced the changes in the industry.
Men have gone out of the pits, pits have closed and the men have been redeployed in other pits, but there has been hardly a ripple on the water in the House of Commons. During the years that I have been a Member of House, I have seen Ministers of Labour come to report that delicate negotiations are taking place because of a stoppage or threatened stoppage in one industry or another and that hon. Members on the Opposition side should not say too much at that moment because of the serious position in the industry in question.
That has never happened with the mining industry. During all the years I have been a Member, not once has a Minister of Labour reported on a national stoppage or threatened stoppage, or, indeed, a stoppage of any great extent. I have been here on occasions when a Minister of Power has, unfortunately, had to report on a mining accident or an explosion.
Recently, my right hon. Friend has told us of the seriousness of the oil supply position as a result of the Middle East crisis, with all the fear which that creates in the minds of the people. We hope that my right hon. Friend will overcome the difficulties of a shortage of oil. With oil, however, the question of the cost of production does not arise. We require our oil supplies from the Middle East to keep our Services moving. Therefore, when dealing with this subject, we need to bear in mind that it is not always the direct cost of production that is involved when dealing with energy but with military needs. We are scheming and negotiating today because we have to think always of oil.
There has been an increase in the output of coal per manshift. One hon. Member gave the figure of 34 cwt. per man-shift. It rose in the last quarter of last year to 39 cwt., or 40 per cent. higher than the 1960 level. This has been done in co-operation between the Board and the National Union of Mineworkers to make the industry more competitive. That has been the spur, and rightly so.
The biggest consumers of coal are the electricity power stations, but there has been a marked decline in the last two years in their consumption of coal. That is partly due to the increasing part played by the nuclear power stations, the output of which in 1965–66 amounted to 6·8 million tons of coal equivalent. In 1966–67, it was 8 million tons, in 1967–68 it is likely to be 9·5 million tons and by 1970 the nuclear power stations are expected to contribute 14 millions tons of coal equivalent, which corresponds to the employment of 28,000 miners. That is a tall figure, and yet none of the nuclear stations is operating at a cost which is competitive with electricity generated from a new coal-burning station.
Coal-burning stations produce cheaper electricity than do the nuclear-powered ones. I know that my right hon. Friend

says that nuclear-powered stations will produce it cheaper in the future. He is no doubt well advised, but I remind him that though it was originally stated that the cost of electricity produced by nuclear power would be 0·6d. per unit, this was revised, and the cost went up to 1d. per unit. That is the position. Coal-fired stations produce electricity at a cost of 0·6d. per unit. There is nothing hypothetical about this. These are the facts. Up to now it has cost more to produce electricity by nuclear means than by burning coal. My right hon. Friend says that the cost of producing electricity at nuclear-powered stations will become cheaper than producing it by the use of coal, but this is only what is likely to happen. We can only deal with the facts as we see them. It is no good dealing with hypothetical situations.
Much has been said about coal being competitive. I submit that up to now it has been. When men in the industry are continually being told that pits must close, that there must be a further decline in manpower, even though the industry is competitive, they begin to wonder whether there is any point of continuing in it. They see pits being closed and men going out of the industry. It is said that all this is being done to make the industry competitive, and yet they have to face further closures in the future. This is what the men are thinking at the moment. Although I agree with my right hon. Friend that nuclear power may be cheaper in the future, I submit that we ought to deal with the facts as we find them now.
We are not against nuclear power stations as such. This was made clear by my right hon. Friend the Member for Caerphilly (Mr. Ness Edwards). It is the phasing of them which is important. So far, nine have been built, and more are in the offing. These nuclear power stations are affecting the consumption of coal now. The figure has dropped considerably. This is the problem with which we are faced, and I submit that in any future policy which he considers my right hon. Friend must look closely at the question of having coal-burning stations as opposed to nuclear-powered ones. If the number of nuclear-powered stations is to be increased, their construction should be phased to give the industry a chance to adjust itself to the


changing conditions. If, over the next few years, we are to face a loss of manpower to the extent which I have described, this will be a calamity to the industry.
It would pay my right hon. Friend to say, "Let us get on with the building of nuclear power stations more gradually." I agree that nuclear power will be the source of energy in the future, and that we want to encourage it within reason, but we do not want these stations to be built at such a rate that they will affect the employment of people in the mining industry, with all the hardship which will result. I therefore ask my right hon. Friend to consider the situation very carefully. Nuclear power stations are too big and expensive, and cost £500 million more than conventional ones and cannot produce electricity competitively with coal—

Mr. Marsh: Sizewell, the latest nuclear power station, is already competitive with Tilbury B, the most modern coal-fired station. It would be a mistake to ignore the fact that it is already here.

Mr. Finch: But my right hon. Friend refers to only one station. Coal cost less than nuclear power in the early stations. I hope that he is right and that nuclear power will become more important to our industrial activity, but it should be phased so as not to shock coal mining unduly, as in the past.
On 9th May, in answer to a Question by my hon. Friend the Member for Mansfield (Mr. Concannon), the Minister said that the Central Electricity Generating Board's programme, excluding Oldbury and Wylfa, which were then in operation, would cost £390 million, excluding interest. The programme of the other power stations, excluding interest, would cost £750 million, and a coal-fired programme on the same basis would cost £225 million. What a difference. We must consider this before making further decisions about nuclear power.
The partly disabled men in the industry are the responsibility of the Coal Board, and I wish that it would make some definite statement. Lord Robens has said that he is under an obligation to assist those disabled men who are declared redundant. The problem in South Wales

concerns disabled men of 50 to 55, as others travel to work or are re-employed. Their numbers are growing. Also, hundreds of men suffer from pneumoconiosis who are still without a job and have gone out of the industry.
I beg my right hon. Friend to use his influence with the Coal Board and other Departments to take special measures to deal with this problem. I welcome his statement today and recognise his difficult task over a fuel policy, but ask him to bear in mind the present position of nuclear power and to allow time to phase this in the years ahead and to ensure that if the mining industry is to contract, it will be done more gradually than at present, and that, before any more pit closures, he will consult his colleagues to make sure that alternative industries are made available.

2.45 a.m.

Mr. Eric Lubbock: The final remarks of the hon. Member for Bedwellty (Mr. Finch) reinforced me in my view that, in so far as it is socially and economically practicable, the coal industry should be run down as fast as possible.
The hon. Gentleman mentioned that thousands of men were suffering from pneumoconiosis or had otherwise been disabled as a result of their service in the pits. Other hon. Members have said that men do not go down the mines because they like the work, but because they have no choice. I submit that mining is not a suitable occupation in the second half of the 20th century; and that the sooner we get men out of the pits and into cleaner and more up-to-date occupations the better it will be for those who are at present compelled to follow this occupation.
I admit that there are enormous problems of retraining. As the hon. Member for Canterbury (Mr. Crouch) said, many of the people in his constituency live there not because they are Kentish men, but because they originally followed the occupation of coal mining in Durham and elsewhere and went to Kent because work existed there.
How to train men in new skills in the middle of their working lives raises enormous problems, and it is this subject to which we should be devoting our


energies. We should not blind ourselves to the economics of the coal industry by making the sort of comparisons made by the hon. Member for Bedwellty, between coal-fired power stations of the present generation and nuclear stations of the previous generation.
As the Minister said, even a magnox station of obsolete design is already fully competitive with the coal-fired stations which are being erected now. If one looks at the figures which were given in evidence to the Committee on Science and Technology in respect of the new gas-cooled reactors at Dungeness B and Hinkley Point B for the 'seventies one sees that, even on the most cautious assumptions, nuclear energy will be 10 per cent. cheaper than its coal-fired equivalent. The Chairman of the United Kingdom Atomic Energy Authority has told the electricity industry that in the six years during which the second nuclear programme will be put into effect, he anticipates that the cost of electricity will be reduced by 30 per cent.

Mr. Finch: That is anticipation.

Mr. Lubbock: I agree, but his view is confirmed by the Chairman of the C.E.G.B. The trend can already be seen in the first two tenders which have been received for reactors of this type. The Hinckley Point B tender, which has recently been awarded, was substantially cheaper than the first station, and Dungeness B will be 10 per cent. cheaper than its nearest coal-fired equivalent.
Hon. Members who represent coal-mining constituencies must not blind themselves to the fact that the writing is already on the wall for this industry. The task of the politicians, Lord Robens and his colleagues in the N.C.B. and others, is to see that the best possible transition is made for those who work in the industry. I admire the work that Lord Robens and his colleagues have been doing in this respect. The coal industry has one of the best redundancy schemes of any industry, along with imaginative arrangements for moving men from the less economic pits to fields where coal can still be competitive.
The hon. Member for Bedwellty referred to the enormous loss of manpower suffered by the coal industry, but many other industries, such as ship-

building, textiles and the railways have suffered considerable manpower reductions.

Mr. Finch: A reduction of 300,000?

Mr. Lubbock: I am speaking in proportionate terms. It has been pointed out that in the 'twenties the coal industry employed about 1·2 million men. These other industries were not as large to begin with. Thus, proportionately, the loss of manpower on the railways has not been very different. I am glad to pay tribute to the fact that the reduction in manpower has been effected by the coal industry in a far more humane way.
The Minister's figures are not "up the creek" at all, as I think one of the Derbyshire Members suggested. If an output of 156 million tons could be achieved by 1970 it would greatly ease the burden that the House has placed on Lord Robens in making the adjustments of which I have spoken. The House should not bind the Minister to the figure he has quoted this evening. We should look at it as a planning target to which the industry and the right hon. Gentleman are attempting to adhere.
All these figures are bound to be affected by technological developments in other sectors. When the Government produced their fuel policy only about three years ago, no one imagined that by 1970 we would be producing daily about 2,000 million cubic feet of natural gas from the North Sea, but that is just one of the factors that has completely upset the calculations. No one can be quite certain that between now and 1970 there will not be further large-scale developments. I see that there are even prospects of oil being discovered in the North Sea off the Scottish coast.
Such developments could completely invalidate today's estimates. I very much hope that such discoveries are made, as they would transform our whole energy position, as the discovery of natural gas is already bidding fair to do. It would mean that we would be far less dependent than we now are on imports of oil from the Middle East and of natural gas from Algeria. The hon. and gallant Member for South Fylde (Colonel Lancaster) said that there was some anxiety about imports of natural gas from Algeria having been cut off because of the dispute in the


Middle East. I wonder whether that might not have been a good thing. If it were possible to rescind that contract and depend entirely on our indigenous resources, we could economise on foreign exchange and more rapidly develop our resources only a few miles off the coast—

Mr. Adam Hunter: Is the hon. Member aware that several pits can send out coal to generating stations at 3d. per therm, and that the industry hopes to better that in the near future?

Mr. Lubbock: I am aware that the Chairman of the Coal Board has said that if he were absolutely free to determine his own pricing policy he could produce coal at the power stations in the most favourable areas at 3d. a therm. But, if he were to do that, it would no longer be possible for him to have an averaging policy throughout the whole of coal production, and the price to certain other consumers would have to rise.
If I may say so, Lord Robens, for whom I have the utmost respect, is not the most brilliant economist. He talks of the actual cost of producing coal from the low-cost fields, and of how much better it would be if he were able to deliver at that cost to the power stations, quite ignoring the fact that in South Wales, Kent and other places where coal is not mined economically, and where the consumers are subsidised by the cheap coalfields, the consumers would have to pay far more than they are paying at present if Lord Robens were to let the power stations in those areas have the coal at cost price.

Mr. Concannon: Surely the hon. Member knows that 60 per cent. of the coal delivered to the power stations is delivered at 3½d. a therm and the average is 4½d. a therm?

Mr. Lubbock: The hon. Member is suggesting that very little difference could be effected by bringing the price down to 3d. a therm. If, at DRAX, the price is already 3½d. and that station is to produce at something like 0·57d. per kilowatt hour, whereas at Hinkley Point it is down to 0·54d., no difference will be made by calling the price 3d. instead of

3½d. a therm. The hon. Member is helping to make the case for nuclear power as against coal fired electricity stations. I advise the hon. Member to look at the figures given to the Committee on Science and Technology by the Chairman of the Electricity Generating Board.
Perhaps I should not go into this matter in great detail. I am a little inhibited by having been a member of that Select Committee, although it is different from every other Committee in that our evidence has been made available to the public outside and to hon. Members. Perhaps there is a little more latitude about what we say than, for example, in the Select Committee on Nationalised Industries.

Mr. Shinwell: Will the hon. Member enlighten me on this? He says that his Committee has been advised by the Central Electricity Generating Board experts, but Lord Robens is advised by other experts. How are we to judge? He seems to dismiss the 400,000 men who will be displaced if the mining industry is run down to negligible proportions. How are we to find alternative employment for these men?

Mr. Lubbock: There are about 400,000 employed in the industry at the moment. I am not talking about running the industry down to nothing, so we are not talking about 400,000 being found employment between now and 1975, which is the sort of period to which I am referring. The transition will not be so rapid as that. The problem is a manageable one, provided that this House and the Coal Board grasp that it is a matter of some urgency. We have to retrain people who have worked in the industry for a considerable time in other skills and not accept, as the hon. Member for Canterbury appeared to accept, that because they have been employed in the industry in Durham they are entitled as of right to a similar job in Kent.
The age structure in the industry makes this difficult because more men of 50 and over are in it than on average are employed in industry as a whole. We therefore have a bigger retraining problem than in other declining industries, such as shipbuilding and railways. That makes it even more necessary for the House and the Coal Board to give serious and urgent attention to retraining these


people and finding adequate means of easing their transition to other employment.
If it is not out of order, I want to refer 70 the Order itself. It has not been the subject of much discussion tonight. In the 1966 balance sheet of the Coal Board the total in loans from the Minister was £575 million and the bank overdraft was £4·7 million, making, roughly, £580 million. The Minister now asks for an increase in the Board's borrowing powers from £700 million to £750 million. I do not know—I have tried to ascertain this evening without success—what the total expenditure of the Beard was during 1966–67 over and above its depreciation provided for. It is not possible for me to say whether this increase in the borrowing limit is justified in the light of the 1966–67 balance sheet, or whether the Minister is anticipating some likely changes in the Board's finances which will take place in the next two or three years. Before the debate ends, the Parliamentary Secretary should let us have a little more information about the profit and loss account results for 1966–67 and about when he thinks the borrowing limit of £700 million will have been passed.
I realise that the Minister said that before long it would be necessary to introduce a new Bill providing for a reconstruction of the Board's capital. Here again, it is necessary for the House to know, before approving the Order, roughly when that position will be reached. If the Minister could give the answers to these two questions, I think that there would be no objection to the Order.
I do not agree with hon. Members on this side who have sometimes contended that the Board should not be entitled to diversify into other areas, whatever they may be. I was a supporter of the idea that the Board should explore for gas under the North Sea. I believed at the time, and I still believe, that it would help to give a boost to the miners' morale if they thought that a profitable operation was being entered into by their enterprise which would assist in making it viable and in making their employment secure for the future.

Mr. Albert Roberts: Does not the hon. Gentleman agree that there should be more research into the possibilities of

getting oil from coal at an economic price?

Mr. Lubbock: I understand that considerable research has been undertaken into this by the Board in the past and that, as at present advised, it finds that it is not economical in comparison with obtaining oil from ordinary wells. I certainly believe—this may help the hon. Gentleman—that the Board should continue to undertake all possible research into the use of coal or coal derivatives in other respects. For example, I think that there is no objection whatsoever to the Board's going into the brick-making processes which it has entered into in the last few years. Any enterprises which can be directly connected with the getting of coal are perfectly legitimate. It is rather interesting to notice that tonight we have not heard from the Conservative Party any of the objections that we heard last time we debated the coal industry, when there was the question of lending a very small amount of £6 million to explore for natural gas under the North Sea.
I am glad that this principle has now been accepted, and I would recommend the House to accept this increase in borrowing limits.

3.3 a.m.

Mr. John Cronin: I have the greatest respect for the undoubted abilities of the hon. Member for Orpington (Mr. Lubbock), but I listened to much of his speech with complete astonishment. If I heard him aright, he wants to run down the coal industry as rapidly as possible and replace coal production by other forms of fuel as quickly as possible.
The hon. Gentleman is the official spokesman of the Liberal Party. I am sure that all of us would like people in our constituencies to know what the official policy of the Liberal Party is about the mining community. There seems to be no doubt—all our mining supporters should know this—that the Liberal Party is in favour of a complete rundown of the industry as rapidly as possible.
I always enter these debates on power with a certain amount of diffidence, because so many of my right hon. and hon. Friends have immense experience in this industry, experience which they


gained in trade unions—in the National Union of Mineworkers and in other allied unions. In my constituency, I have four collieries. I have three belonging to the South Derbyshire group—Rawdon, Donisthorpe and Measham, and one belonging to the Leicestershire group—Lount. This is an occasion when I feel that I ought to express some of the views of the miners in those collieries.
I very much welcome the Minister's speech. I particularly welcome his asking the electricity industry to consume a further 7 million tons of coal a year. This will be a substantial help to the coal industry. We are very glad that he has announced special measures to assist those miners over the age of 55 to retire. I think this is very helpful and human work. I am also glad to hear that we are to have a White Paper on energy policy—

Mr. Lubbock: I thought the hon. Gentleman disagreed with my view. Now he says that he agrees with the Minister that miners over the age of 55 should be allowed to retire. Is that not what I was saying?

Mr. Cronin: I was referring to redundant miners. I got the impression that the hon. Member wants all miners to retire so that other forms of energy can take the place of coal. This appears to be the clear policy of the Liberal Party.
I think that the present Minister is probably the most able Minister of Power we have had during the 12 years that I have been a Member of this House, so if I make some criticisms of him I hope that they will be regarded as friendly ones. My right hon. Friend said that the decline in the market for coal is inevitable. He said that a contraction in the coal industry is inevitable. There is a certain amount of pessimism about this attitude. My right hon. Friend is subject to all kinds of pressure. He has pressure from the oil interests, from industrialists who want the cheapest form of fuel and from his own economists in his Ministry. I believe that nobody can be more wrong about economics than an economist when he really gets going.
This pessimism on the part of the Minister about the coal industry is unjustified. Earlier, I drew his attention to the situation in the United States

and in the Soviet Union, and I believe that the hon. and gallant Member for South Fylde (Colonel Lancaster) echoed this point. In the United States an enormous expansion is taking place in the coal industry. It is hoped to increase the output from 360 million tons to 600 million tons a year, a gigantic increase. In the Soviet Union they are talking about 1,000 million tons of coal a year.
Obviously, we cannot compete with those figures, but not all the coal—not even the major proportion of the coal—in the Soviet Union and the United States is obtained easily. I am quite sure that if there is room for this tremendous expansion in the coal industries of those two large industrial countries, it is not necessary to have a run down in the coal industry in our country, which is of a similar industrial type.
The present Government's record in the coal industry has been mostly continuously good. There has been the massive writing off of the Coal Board's debts. A sum of £30 million has been allotted to the social cost of reorganisation. There has been the resistance to imports of foreign coal. There is the continued 40 per cent. tax on fuel oil, and there has been discrimination against oil for power stations.
These have been positive and helpful acts for the benefit of the coal industry, but they are no more than minimal aids. They are all essential, for what the coal industry should have is protection in just the same way as agriculture, shipbuilding and many other industries. Such protection is in the national interest.
We must not forget the effect on morale of the measures proposed. The efficiency of any industry depends to a large extent on morale within it, but for the coal industry, an industry in which there is a large element of danger and particularly disagreeable conditions of work, morale is all-important. This applies also to the families of miners, who may have to live in isolated communities, often remote from the more agreeable amenities of modem civilised life.
For this reason, it is most important that the coal industry should have a clear indication of Government policy,


and that policy should be one which will put a stop to the gradual running down of coal production which has been different Governments' policy year after year. For the sake of morale in the industry, there should be a radical change in this policy.
The rôle of oil in our national fuel policy presents increasing danger. Both nuclear power and North Sea gas are sources of energy indigenous to our country and, obviously, they are unexceptionable, provided that they are economic. On the other hand, there are serious dangers in the increasing rôle of oil. In 1956, coal output was about 217 million tons, and now it has run down to 172 million tons, or 165 million tons of deep worked coal. In 1956, oil consumption was 37 million tons of coal equivalent, and now it has risen to 93 million tons, a nearly threefold increase. This cannot be a healthy state of affairs.
First, there is the political instability of the oil producing countries. Oil supplies always have an element of uncertainty about them. Recent events in the Middle East have reminded us how tenuous the maintenance of oil supplies can become. Excessive reliance on oil can have a dangerous influence on pricing, as well. The various consortia and large companies which send oil to this country are keen business organisations. They are shrewd and ruthless. I am sure that, if this country became excessively dependent on oil as a fuel, the price of oil would go up out of all proportion. This is a serious risk which has not been yet sufficiently considered.
The other important consequence of increased oil consumption is on our balance of payments. Throughout this century, Britain has been cursed by balance of payments difficulties, and since the war we have had crisis after crisis. It would be the height of folly, therefore, to put undue reliance on a fuel which is 100 per cent. an imported product and which puts a corresponding burden on our balance of payments. That cannot be sound economic sense.
I accept the point the Minister made, that the price of coal has an important effect on our balance of payments as we must have cheap fuel to export competitively. But, surely, the solution is not to import more foreign oil, which has a 100 per cent. adverse effect on our

balance of payments, but to improve the efficiency of the coal industry by injecting more capital into it so as to reduce the price of coal. After all, coal is 100 per cent. an indigenous product, and capital expenditure on increasing efficiency in coal production must have a favourable effect on the economy as a whole.
The coal industry deserves all the help and support it can obtain from the Government and the House. I am not suggesting this on emotional grounds, although there is room for emotion when discussing the industry when we think of the disagreeable dark working conditions to which a large number of men are confined, of the dangers they risk, of the thousands of miners who are out of breath and coughing with pneumoconiosis, and of the thousands who have been severely disabled. But, at the same time, the House must consider the coal industry dispassionately and in terms of the national interest.
The industry has a fine record. No other industry has a finer record in increasing productivity, in flexibility and the redeployment of labour. No other industry has adapted so well to changing conditions. The real remedy is not to cut coal production, but to give the industry more help with capital expenditure to produce coal more cheaply and efficiently. It needs all the support the Government and the House of Commons can give it, and that support will be in the best interests of the country as a whole.

3.17 a.m.

Mr. Eric G. Varley: Many of the points I wanted to make have already been made. I am getting very tired and I am sure that as those points have been made I can jettison some of the speech I wanted to make. I certainly want to underline some of the points of my hon. Friend the Member for Loughborough (Mr. Cronin) and comment on some of those made by the hon. Member for Orpington (Mr. Lubbock).
My right hon. Friend the Minister made a very important statement tonight. I am still in a little doubt about the sort of production figure he claims he has now allocated—if that is the right word—for the coal industry. Nevertheless, he


made some important announcements. I agree with my hon. Friend the Member for Loughborough that he is certainly the best Minister of Power that we have had in the past 15 years. I think that he is beginning to understand some of the problems affecting the mining industry, and I hope that he continues to show this awareness of them.
As my hon. Friend said, we have a great deal of despair and despondency in the mining industry at the moment. It is an industry which is outstripping all others in productivity, but which still has an uncertain future. My hon. Friends have pointed out many times in the House that if other industries had the same productivity record we should not be experiencing the economic troubles that face the nation today. Only this afternoon, my right hon. Friend the Prime Minister, answering a Question by, I think, the hon. Member for Louth (Sir C. Osborne), emphasised yet again that no other industry had the coal industry's record of productivity.
Now the miners are crying out for help and understanding, and some sort of respite from the too rapid rundown of the industry. My hon. Friend the Member for Bedwellty (Mr. Finch) has effectively made the point that miners are not Luddites. When one looks at the transition that has taken place in the industry, with men who were brought up and trained only to use hand tools at the coal face now using modern, sophisticated machinery, there can be no possible reason for suggesting that they are Luddite in their attitude. They are nothing of the kind.
I recognise that the problem is not easy for my right hon. Friend the Minister. He has a difficult task in trying to solve the conundrum of competing fuels. In referring to oil in relation to the competitive position of coal, my hon. Friend the Member for Loughborough pointed out that in foreign currency oil costs us about £500 million a year. Some people claim that this is offset by invisible exports, but that has never been quantified and no figures have been given to the House. My hon. Friend the Member for Bedwellty pointed out that the Opposition on occasion quaintly talk about protecting essential British interests in the Middle East, where we keep

massive forces. That massive defence commitment never finds its way into the accounts of the oil industry.
Another competitive force was mentioned by the hon. Member for Orpington—nuclear power, or electricity from the atom. When one says this one's mind begins to boggle. It amazes me how every time this is suggested everybody seems to accept without question that electricity from nuclear power is cheap. I do not accept this on the evidence that I have seen so far. I have seen the battle that has been going on in the Financial Times between the Chairman of the National Coal Board and the hon. Member for Orpington, and I think that Lord Robens is winning. I know that there is a dispute about the working party's report. The hon. Member for Orpington complains that he has not seen it. But we had an assurance from the Minister today that he will publish it and make it available to the Select Committee on Science and Technology so that people will be able to make the comparison.
The nuclear power programme cost a considerable amount of money. The same amount of electricity generating capacity could have been provided at about a third of the cost. We also find that a considerable amount is being spent in providing electricity capacity from nuclear power by means of the second nuclear power programme based on the advanced gas-cooled reactor station. That capacity could be provided by conventional means, principally by coal-fired stations, at about half the capital cost. I know that the figures are in question.
However, I agree with my right hon. Friend the Member for Easington (Mr. Shinwell) that what we are talking about is jobs—alternative employment—for about 100,000 miners if one takes the difference between what the coal industry is producing now and what it is likely to produce if it achieves the new target set by the Minister of Power.
I do not think that we can completely disregard the comparison of costs between coal-fired stations and the A.G.R. programme. Frankly, I think that in Dungeness B, Hinkley Point B and Hunterston B we have all we need. I shall be very disturbed if the Minister takes the decision to go nuclear at Heysham and Seaton


Carew. I do not think that there is any justification for this. I think that we have enough technical "know-how" at the moment to move to the fast breeder reactor station. It is unnecessary and unrealistic and wasteful of national resources to go nuclear at Heysham and Seaton Carew.

Mr. McGuire: My hon. Friend is 100 per cent. right. We are to build two Magnox stations which are already obsolete. We will gain no more technical "know-how" that we had from the first couple. He is on the right track.

Mr. Shinwell: The coal is there.

Mr. Varley: I am grateful to my hon. Friend for his intervention. As my right hon. Friend said, the coal is there.
Natural gas will also compete. We all welcome the fact that we have discovered natural gas. It is an indigenous fuel, as the right hon. Member for Leeds, North-East (Sir K. Joseph) said. It is cheap and of marvellous quality and there is no doubt that it will be of great benefit to the nation. But we have to think carefully about how we use it. One thing that we do not know for certain is how long it will last. Will it last for 25 years if it is used at 200,000 cubic feet a day by 1970 and 300,000 cubic feet a day by 1975? This is three times the consumption at the present time. How do we use it? Are we to use it for power station boilers? If we do it will be extremely wasteful.
This source of fuel of high quality is pre-eminently suited to the domestic market. It is non-toxic, clean and already stored in the North Sea. We do not need a big Abingdon gasholder. We have to consider carefully how we use it. As a nation we would look silly if, after 25 years of using it at 300,000 cubic feet a day, the wells ran dry. We should use this great national asset as far as possible in the domestic market.

Dr. M. P. Winstanley: Would the hon. Member not agree that we would also look stupid if, after 25 years, we were still having to mine coal underground, with all the attendant evils? I am wondering, when he advances the advantages, whether he prefers the present evils.

Mr. Varley: I was nearly diverted by the hon. Member into going into the

Liberal policy. The Liberal view, as stated by the hon. Member for Orpington, is to close the pits as quickly as possible. What we are primarily talking about is finding alternative jobs. I will come to the point the hon. Member for Cheadle (Dr. Winstanley) has raised. Natural gas should be used primarily in the domestic market.
What we are talking about tonight is the jobs of 100,000 miners. When we talk about reducing annual output from 200,000 tons to 150,000 tons we are talking about the jobs of 100,000 miners in such difficult areas of Durham, Scotland, and South Wales. It is a question of seeing how far we can have economic and industrial reconstruction of these areas. I do not think that there is any evidence that this has been thought out. I do not know whether the Minister was saying that a Cabinet committee would be set up. I would like to see one consisting of the President of the Board of Trade, the First Secretary of State, the Minister of Labour and the Minister of Power, and perhaps the Chancellor of the Exchequer, to look at this problem. If we are to have this kind of reconstruction of the old mining areas we will do it only by that sort of committee with power to act and power to ensure that industry comes into these areas.
The other point overlooked in the debate to some extent is the fact that a tremendous amount of cheap coal is still available. My hon. Friend the Member for Blaydon (Mr. Woof) said that about 120 million tons was being produced at less than 5d. a therm. This is really a phasing problem. To superimpose a further closure programme on the existing programme would bring catastrophic results to these difficult areas.
Already, the Coal Board is closing down a pit a week. We must remember what that means. In some cases there is no new alternative industry for the men to go to. To suggest, as the hon. Member for Orpington did, that the industry should be phased out as quickly as possible and immediately is callous and inhuman. I hope that the Liberals will reconsider their position.

Mr. Lubbock: The hon. Member must not misrepresent what I said. I said that it should be done as quickly as is economically and socially practicable. I


meant that it must be done as far as possible with proper phasing of new jobs to replace those lost in the mines.

Mr. Varley: I am grateful for that intervention. I have got the Liberal Party off the hook, because the hon. Member gave the impression—

Mr. Lubbock: The hon. Member was not paying attention.

Mr. Varley: —that he was being callous and inhuman.

Mr. Lubbock: This is pure distortion.

Mr. Varley: It is really a question of the economic reconstruction of these areas, which is most important. The Labour Party owes a tremendous amount to the miners. If the Government allow miners to suffer the degradation of the dole queue because of the Government's inability or unwillingness to generate new job opportunities, they will not be forgiven.
I have great confidence in my right hon. Friend. He is tackling the job realistically. Lord Robens confirmed that at the N.U.M. conference. These problems are of serious concern to mining areas, particularly in some of the older districts. In the long term, I am optimistic and hope that my optimism will not prove to have been misplaced.

3.33 a.m.

Mr. G. Elfed Davies: My right hon. Friend has a difficult task. Anyone in the industry or who lives in a mining area must realise that that is so under present conditions. It is unfortunate that the hon. Member for Worcestershire, South (Sir G. Nabarro) is no longer with us and has not been for some time. He said that nationalisation had failed. Nationalisation has not failed. It has succeeded. Certainly, no one in the mining industry would turn the clock back and return to private enterprise.
Tonight, we are discussing a proposal to increase the borrowing powers of the Coal Board by £50 million. The reason which my right hon. Friend gave for it is that the Board is stocking so much coal. What would have happened under private enterprise in a similar situation? Instead of stocking coal, pits would have been stopped and miners would have

been working short time. That is why I say that nationalisation has not failed.
One problem which has had to be faced in recent years has been the redeployment of men necessitated by colliery closures. The Coal Board has recognised that the living standards of 400,000 miners and their families depend upon it and are its main responsibility. Here, I want to pay tribute both to the Board and to the National Union of Mineworkers, who have worked so well to meet the problems which have resulted from pit closures. Social problems have arisen which have never before been experienced in any other industry.
By 1970, the present closure programme will be completed, and the industry will be left with the capacity to produce 170 million tons a year. That output will come from a much smaller number of highly efficient and profitable pits. The problem is to find the market for that production, and it is one of the grave problems which my right hon. Friend has to solve.
As my hon. Friend the Member for Chesterfield (Mr. Varley) said, the Board is closing an average of one pit per week, and I must warn the Minister that the industry cannot face a second closure programme imposed on top of the first. It has been stretched to the limit already to meet the social consequences which will result from the first round of closures. If we reach the stage when it becomes necessary to close profitable pits because their output cannot be sold, it will have a catastrophic effect upon the morale and confidence of the industry, the desire to work for increased productivity will be undermined and men will leave the industry so fast that the tonnage of coal necessary will not be produced.
The Minister has stated repeatedly that coal must provide a substantial part of the total energy needs of the country for many years, and the requirements are estimated to be about 100 million tons higher in 1980 than the present figure. In view of that, nothing should be done now or in the immediate future to destroy the confidence and morale of an industry upon which so much depends.
What are some of the elements which must be taken into account in working out a sensible fuel policy? It is certainly important to have cheap fuel, but


to decide between different fuels on the basis of production cost competitiveness alone would be both wrong and unwise. Such a comparison ignores completely the vast differences in the total social cost to the community. Even the picture of direct cost is not as clear as it is sometimes made out to be.
When the last of the first programme of nuclear power stations comes into operation in 1970, it is claimed that generating costs will be about equal to those of a coal-fired station. In 1971, however, Dungeness B, the first of the new advanced gas-cooled reactor stations, will start operating, and in 1965 it was estimated by the Central Electricity Generating Board that electricity from that station would cost 0·457d. per kilowatt hour. On 2nd March this year, however, the Ministry revised that figure upward to 0·5d., compared with 0·5d. to 0·6d. from coal-fired stations.
Beyond the A.G.R.s lie the fast breeder reactors, expected in about ten years' time, which, according to Sir William Penney, Chairman of the Atomic Energy Authority, should generate electricity at 0·3d. per unit. However, apart from the fact that these costs exclude the cost of research—which is of vital importance—which was carried by the A.E.A., it must be said that the recent 10 per cent. increase in the estimate of A.G.R. costs may not be the last. As the Financial Times stated on 22nd May this year:
As with aircraft projects, nuclear power station costs can rise staggeringly between the inception of a project and its completion.
Price rises for oil are very likely. Indeed, the present situation leads one to believe that they may not be far distant. The uncertain situation in supply should not be lightly disregarded. For the life of me, I cannot understand why, when balance-of-payment problems are so acute, imports of fuel oil from foreign refineries at the rate of about £60 million a year should be even considered, let alone allowed, as they are at present.
Every increase in oil consumption increases our dependence on imported fuel. The foolishness of this needs no under-filling at this time. It would be madness to allow the rundown of the coal industry if that increased our dependence on imported oil.
Present indications are that the supplies of natural gas from the North Sea will amount to about 3,000 to 4,000 million cu. ft. a day by the early 1970s. That is a welcome addition to our source of indigenous fuel. It is welcome because it is valuable to the nation. Because it is valuable, however, and because it is so welcome, it is necessary that great care should be taken to use it wisely in the best interests of the nation.
It is reported that authority has been given to the Central Electricity Generating Board to convert a boiler at a coal-fired station in the Midlands to burn natural gas, and this before even the price has been fixed. Is it sensible to use such large quantities of a primary fuel to produce a secondary fuel at less than 50 per cent. efficiency? Not only would it be a waste of a valuable asset, but it could not be justified, even on economic grounds.
As most of the uneconomic pits are closed, the price of coal is expected to come down. Dr. William Reid, the Chairman of the Northumberland and Durham Division of the National Coal Board, recently said that
a substantial tonnage was now being produced in the Division at less than 4d. per therm.
The shutting down of most of our pits by too fast a contracting of the industry will mean tremendous social costs, the abandonment of the assets in the coal-fields, the expense of providing new capital either there or elsewhere, and an expansive programme of retraining. If production were concentrated in one or two of the best coalfields, all the investments made in the others would be lost—£132 million during the last five years alone.
But most important of all is the misery which would be caused to the 100,000 to 120,000 miners and their families. Most of this would happen in areas which are already suffering from a lack of new industries. I can speak with some experience of this. When I came to the House, there were eight collieries in my constituency, with five or six in the constituency of my hon. Friend the Member for Rhondda, West (Mr. Alec Jones). There are now none in his constituency, and three in mine, two of which are on the doubtful list. The great name of


Rhondda, which has been associated with mining and coal over the years, is likely soon to have no colliery at all.
But what hurts more than the losing of collieries, because and I believe that if the time comes when all our people can have a job without going down a mine it will be a good thing, is to find that unemployment in my constituency is running at 10 per cent. Yesterday we received a message that a firm of radio rentals had been taken over by a firm in London, and that another 120 to 150 people were to be put on the dole on Friday of this week. This is the problem which we are facing, and something must be done, and done quickly.
This is not a matter for the Minister of Power alone. It is a matter which the Government must tackle. If these collieries are to close, and there is to be a rundown of the industry because of Government policy, the Government must be responsible for the social consequences that follow. I sound a note of warning to the Government—and to everyone in the House—that unless something is done to deal with the problem, they will feel the result of this in the winds that will blow later. The Government must realise that no section of the community has done more than the miners to see that they are the Government. They still have faith in Socialism, and in the Labour Movement, but they are beginning to lose faith in this Labour Government.
From the bottom of my heart I say to the Minister and to all concerned that they must do something quickly if they are to arrest this decline and give these people who served this nation so well the consideration which they deserve.

3.50 p.m.

Mr. Edward Milne: My hon. Friend the Member for Rhondda, East (Mr. G. Elfed Davies) was right to underline the social consequences of the policy outlined by my right hon. Friend and the matters associated with it in his speech which started this debate, a long time ago.
The point with which I want to deal is that of providing alternative industries in the areas affected by the policy outlined by my right hon. Friend. Any Minister of Power, and especially the one that we have at the moment, whom we

in the Northumberland coalfield think has been doing a magnificent job in so many ways, is bound to be on the horns of a dilemma.
If the annual output is left too high, the industry's profitability and ability to compete with the other fuels will be endangered. If the Minister cuts back too much, the Government will face the prospect of unemployment and other social problems in the districts which so many of us represent. This is where the first solution must be found. I would not agree that the miners' loyalty to this Government has been eroded, but there is despair and disappointment that social problems in their communities have not been tackled as they had a right to expect.
Before any cuts in production or of numbers of miners, the need of the areas concerned must be assessed. Because this was not started, as it should have been, in the mid-50s, the problem is now all the greater. We are talking of cushioning the effects of this policy on miners of 55 and over by paying some sort of remuneration. But, as a nation facing industrial change, by virtually pensioning off the most adaptable section of our labour force at 55, we are turning our backs on future industrial expansion. Redundant miners cannot be written off at 55 merely with cash allowances. In a declining mining industry, that manpower must be used to the utmost and full employment created to take the place of the industry in mining areas.
The coal industry cannot be planned in isolation. We have talked about an annual output of 155 million tons, and in 18 months will probably be talking about another estimate of future production. So we are discussing not merely a coal borrowing Order or even the contraction of one of our major industries. This problem of industrial change must be tackled by a Government who are determined to achieve proper industrial expansion.
We in the mining areas are not arguing merely for the protection of the coal in-industry. We want full employment, with the introduction of alternative industries to make up for the loss of jobs. The coal industry must take its place with the three other major fuels that are


competing to give us the energy programme we require. The Government have not provided the full employment that should be available and many of the excellent policies for the development areas and other parts of the country have not gone far enough.
We must have some form of direction of industry if we are put jobs where they are needed. Hon. Gentlemen opposite may not relish this idea and even some of my hon. Friends will say that if we had direction of industry, direction of labour would follow. I am not afraid of that, because the people I represent are already so directed. Each time one of my constituents gets a one-way ticket to another coalfield, or takes another job elsewhere in the country, he is subject to direction—

Mr. Speaker: Order. The hon. Gentleman is getting wide of the Order.

Mr. Milne: With respect, Mr. Speaker, what will happen to workers affected by proposed legislation must have our close attention.
I fear that the Government have looked at the coal industry in isolation and have not considered the wider aspects of industrial expansion. Some industries have been attracted to my constituency and some miners have adapted themselves to a new industrial life. If the miners had a choice between working in the pits, with the coal industry being protected, and an assurance of full employment in alternative industries, they would willingly choose the latter.
The industrial areas have served us well in the past, industrially and politically. They now need our help. There must be full employment in all areas, and not merely the Midlands and the South. Nor must we look at the coal industry in isolation. I plead for full employment for all parts of the nation, and not just the coal mining areas—although these areas laid the foundations of our recovery in the immediate postwar years. Having laid those foundations, they are entitled to share in the benefits now. That is for what we ask and what we believe we will get. We will not stop asking for it until we get it.

4.0 a.m.

Mr. J.J. Mendelson: Some hon. Members have spoken about the serious way in which their areas will be affected, and my right hon. Friend the Minister knows that concern is widespread throughout the coal mining areas. A fortnight ago, the Yorkshire area of the National Union of Mineworkers held its' annual gala, at which the Prime Minister was one of the principal guests. Representatives of the executive committee spoke to the meeting and to the Prime Minister in the most serious terms of their concern and that of their members about the general position.
It is, therefore, not possible to argue—and I do not say that my right hon. Friend came anywhere near to arguing it; it is foreign to his way of thinking about the industry—that there can be any feeling of security in even the most profitable areas if there is grave uncertainty and a serious decline throughout the industry as a whole. Those who are planning our future fuel needs must take that feeling very seriously into their consideration.
I welcome, as will the people whom I and other hon. Members from the coal mining areas represent, many of the points made by my right hon. Friend. His statement has been eagerly awaited. A number of people feel that it could have been made a little earlier. This is not the time or the occasion to go into the reasons for the delay, but an occasion to concentrate, as the Minister himself did, on a very few essential points arising from his statement and then to leave well alone.
I ask my right hon. Friend to accept a very clear distinction between two problems that should not be muddled up; first, what ought to be done to retain an efficient and viable industry, and secondly, the provisions that might be needed to create new industries and certain social measures if a pit has to go out of existence. I am glad that I carry my right hon. Friend with me in this thought. But the best possible provision and the most advanced social arrangements can be of little relevance if we are left in the future with an industry that is not viable and cannot do the job allocated to it. These two points, of


equal importance, must be kept quite separate.
I do not believe that the Government have yet got down clearly to the determination of a policy to make quite certain that the industry will retain all the miners and managers and technicians in the right age groups to make it a viable industry in the future. I make no complaint that my right hon. Friend was qualifying figures he gave by reference to certain technical achievements and achievements in pricing which in his judgment the industry must achieve. I was more worried when listening to the right hon. Member for Leeds, North-East (Sir K. Joseph) who used, I think five times, the term, "reducing the industry to its competitive core". That was his favourite phrase and it worried me a great deal. If that is all he advises the Government to do, we would end up with an industry which will not be able to do its job in future. There will be no implementation of a national fuel policy, but a narrow concentration on immediate market competitiveness and the future planning of the industry will not be undertaken.
Therefore, I hope that the Government will bear in mind that they have to make quite certain, even if it means not accelerating the cutting down of production in certain areas and pits which at any given moment are not fully achieving the results for which the Coal Board hopes, that they are maintaining an industry which will remain viable in future. This requires stretching the financial argument beyond the immediate competitiveness which was mentioned a good deal in the discussion. I do not plead this on grounds of social policy, but on grounds of pure efficiency.
We have just been through a period where, in one of the best coal-producing areas, in Yorkshire, people were leaving the industry in considerable numbers. That shortfall was put right by the economic recession, but we cannot plan for development for a future in which we shall have a semi-permanent recession. Therefore, as we must do everything we can to get out of the economic recession, we cannot rely on the numbers in the right age group being kept in the industry in the most productive areas by people staying in the industry because an economic recession surrounds them. We

look forward to a period when we shall get out of the economic recession.
I turn to the other prong of the argument, concerning the measures so urgently required in cases where, after everything has been taken into consideration, a pit closure is contemplated. I repeat the formula which I and many of my hon. Friends used when we debated the 1965 Coal Industry Act in the House. The Minister then was my right hon. Friend the Member for Newton (Mr. Frederick Lee). The formula which I used was that wherever a pit closure is contemplated it must not take place until an alternative industry has been established in the area or is about to be established within a matter of a few weeks. This policy has not been acted on by the Government.
With other hon. Members I suggested to my right hon. Friend the Member for Newton in that debate that he should give the House an assurance that several Ministers—the Minister of Housing and Local Government, the Secretary of State for Economic Affairs and the Minister of Power—should form a sort of joint staff in this operation. If we look at HANSARD for that debate, we find that we received that assurance from my right hon. Friend. It is not a new idea, but it has not been acted upon. We need an assurance at the end of the debate that it will now be fully implemented.
My right hon. Friend the Member for Newton went further and said that every week those Ministers would meet and would make joint decisions. As they were senior members of the Cabinet, their decisions would carry great weight. If there is to be reassurance in those limited cases where closure is contemplated, there should be a statement at the end of the debate that this policy will now be implemented.
In all the technical discussions there is one element which must not be overlooked. It concerns the kind of manoeuvrability that the economy needs. It is not only the point which has been made several times about the effect of foreign disturbances on our import of oil and the relationship between coal and oil. This is an obvious and important point. Recently, at Question Time, I asked my right hon. Friend whether he did not think there were lessons to be learned from the present position in the Middle East in relation to the accelerating pit


closure programme, and whether this would not be a time to halt it or slow it down. My right hon. Friend said that that was not the occasion to deal with that point, but he did not deal with it tonight either. I hope that my hon. Friend the Parliamentary Secretary will deal with it.
It goes beyond that, however. A country such as ours is not in a position at the present time to plan, as has been suggested by some hon. Members, the complete decline and phasing out of the coal industry. That would be unsafe and unreasonable. I am much encouraged to know that I carry with me my hon. Friend the Member for Bristol, Central (Mr. Palmer), the Chairman of the Select Committee on Science and Technology. It is all very well for some hon. Members to say, "If we had our way we would ensure that nobody worked underground". That is far too glib. We could all say that and get cheered for it. That is not the problem that the House has to deal with tonight, nor will it have to deal with it for years to come. It is not a feasible policy.
A feasible policy is to return to what has been Labour's policy for many years, but which has not yet been implemented by the Government. That is a national fuel policy with sufficient power and control over all the different sources of fuel so that the Government can enforce their intentions. I am glad to see that my right hon. Friend the Minister agrees.
Those who speak of competitiveness Trust remember that there are many industries such as the oil industry which have a considerable pull and which uses all sorts of advantages which are not available to the coal industry. We are not talking here always about what is known as free competition.
The Government have a firm duty, given that this is the intention of the movement that brought them to power, to return to the concept of a national fuel policy and to achieve such a level of control over all the fuel industries and sources of energy which we shall use in future that they can implement the policy. If they do not do so, they will fail the movement and the country. Because of our narrow margins of exports and imports and the economic limitations under which we shall have to work for the

next 30 or 40 years, any other policy would be unsafe.
I hope that we shall get a positive reply from the Government at the end of the debate.

4.14 a.m.

Mr. Alex Eadie: Many miners will be inclined, on reading the report of the speeches made in this debate, to resent some of the statements which have been made, particularly the assertion that, once again, a subsidy is being given to prop up and maintain the coal industry. I do not think the miners will look at it in that way. I hope to develop this argument later on.
I do not think, for example, that the miners will take kindly to some of the rather derogatory remarks that have been made about nationalisation. We are a bit wide of the mark when, in discussing the problems affecting this industry, we talk about nationalisation. Within the compass of my experience I have had the doubtful privilege of being a local trade union leader under private enterprise, and I have also been a trade union leader under nationalisation. I have also had the doubtful privilege of working at the coal face under private enterprise and I have worked at the coal face under nationalisation. There is no comparison. The miners will not be deluded by the inference that if we had some other system than nationalisation, some of the problems would be solved.
It has been suggested by an hon. Member opposite that we must get rid of some of these 19th century practices so that the mining industry can become more viable. We have had reference to profitability. The miners will resent some of these remarks. At some of the pits that we have been talking about the coal owners received unforeseen profits. I am thinking, for example, of Rothes colliery, when I lived in that locality. It was a project which was planned and conceived by the Fife Coal Company. The company received unforeseen profits. The miners have been groaning under this weight for many years.
When we talk about money, profitability, competition, and so on, the miners will not be impressed by this argument. I address these remarks to my right hon. Friend, in particular. What we are talking about is over 100,000


miners becoming redundant as a consequence of the Ministry's announcement. I want to say this in the kindest possible way, because in the past my right hon. Friend and I have had differences in the House. I speak with a great deal of emotion and feeling. My right hon. Friend has made some helpful announcements which can ease the situation, and has probably given some first aid, but I hope that he is not under the illusion that he has helped towards solving this problem.
I am glad that this is only an interim statement that he has made. I hope that as a result of this debate, when he considers the White Paper, he will think very carefully about the policy that he intends to present to the House. What he has announced in his interim statement is completely unacceptable to me. Some hon. Members are apparently willing to write off Scotland to some extent in terms of future coal production. Some of them have spoken of the thin seams. If we are talking about 100,000 miners becoming redundant as a result of this form of production, we are talking about substantial redundancies in Scotland and elsewhere in the North-East. I am not, therefore, much impressed by that argument.
I come now to a comment on my right hon. Friend's announcement that he would give certain information to the Select Committee on Science and Technology. I want to be as kind as I can in this, because I do not want to be accused of being ultra-aggressive or of trying to misquote my right hon. Friend. He was not in the Chamber when I challenged the hon. Member for Worcestershire, South (Sir G. Nabarro) on something which he had said, so my right hon. Friend may not know that I took that occasion to defend him.
In announcing that he would present information about nuclear generation costs to the Select Committee, my right hon. Friend appeared to me to try to give the House the impression that it was information which he had decided to give. I remember sitting in the visitors' seats at a meeting of the Select Committee on Science and Technology when my right hon. Friend was being questioned. There was a challenge about

nuclear generation costs—the hon. Member for Orpington (Mr. Lubbock) will remember this—and, to some extent, my right hon. Friend was caught out in a contradiction on dates, and so forth. He promised to make all the information available to the Committee.
I may be doing my right hon. Friend an injustice, and I hope he will reply to the comment I make, but it appeared to me, when he made his announcement, that he was saying that he would, after all, give the information to the Select Committee, whereas it was my impression that, as an outcome of the evidence which he had presented he would be giving all the information requested or required by the Select Committee on Science and Technology.
There has been a tendency to sweep some of the arguments about nuclear power under the carpet and to ignore the question of comparative costs. It has been said that we should try to develop our own indigenous resources, that nuclear power is far cheaper, and that it is indigenous. Let it be clearly understood that nuclear energy is not an indigenous resource. I am not arguing against it. I am only reminding the House that nuclear power is not entirely indigenous.
For example, it is not generally appreciated that the A.G.R. programme of 8,000 MW—which, incidentally, would be equal to about 20 million tons of coal a year—will add about £10 million to our import bill because of the foreign exchange cost of the uranium. I put that fact into the debate, because there has been so much talk about nuclear power. Although my right hon. Friend was very forthcoming in saying that the first nuclear power programme had proved more expensive than an equivalent coal-fired programme, it is necessary to remind ourselves just how much it cost the nation to go ahead with the first phase of the nuclear power programme.
It cost us £525 million more to carry on with the Magnox programme than it would have cost to carry on with conventional power station generation. That is a substantial sum of money. Added to that, it cost 28,000 miners their jobs. A blunder was made. It is not an entire loss, I agree. None of my hon. Friends would argue that we should not go ahead


and have a nuclear energy programme, but what we do say is that the first nuclear energy programme was far too big. I do not want to apportion responsibility for that, but it has been very costly to the nation, and the miners in particular, as well as the nation in general, have had to pay for it.
When we are talking about the second phase of the nuclear programme, the A.G.R., it is logical to say that we must learn from our experience, which tells us that we made a blunder on the first phase and that we are not going to repeat it with the second.
I sometimes cannot understand the Government's attitude on this or the argument that is going on in sections of the Press. I wish that the hon. Member for Orpington were here, because he is carrying on a correspondence with Lord Robens in the Financial Times, and Lord Robens is wiping the floor with him on this issue.
On 24th June some of my hon. Friends and I had a letter published in The Times which dealt with the question of costs and the second phase of the nuclear power programme. Nobody wrote to challenge the figures we mentioned, and, therefore the nation must consider this matter very carefully.
I think that it was the hon. Member for Orpington who spoke about costs and authoritative statements. I have here a copy of the New Scientist for 9th June, in which there is a challenge on the efficacy of the second phase of the nuclear power programme, although it does not suggest that we should not go ahead. The article, by the magazine's business editor, David Hamilton, ends:
No one denies that the nuclear power programme is desirable or that in the long run it will bring benefits. But the question remains whether we are trying to do too much too quickly.
We are not being Luddites, as hon. Members opposite have conceded. The miners have never been Luddites in their attitude to technological progress.
I found myself tonight, probably for the first lime, in some measure of agreement with the hon. Member for Worcestershire, South, who did not remain very long after he had made his speech. He tried to argue very constructively that my right hon. Friend should consider the whole question of oil, saying that it was

not indigenous and that recent history had proved that its supply was unreliable.
I have extracted some figures showing the penetration of oil into the United Kingdom economy. In 1956, coal consumption was 217½ million tons; in 1964, it was 197·2 million tons. Oil consumption was 36·7 million tons coal equivalent in 1957, representing 15 per cent. of total consumption, and in 1966 it had risen to 111·4 million tons coal equivalent, representing 37½ per cent. of total consumption. Breaking those figures up, we discover that in 1966 17 million tons coal equivalent came from Libya, 70 million tons coal equivalent from other Middle East countries, 12 million tons coal equivalent from Nigeria and 20½ million tons coal equivalent from other sources.
I thought that the hon. Member for Worcestershire, South was being logical over the question of costs. Let us be candid. The closure of the Suez Canal will certainly increase costs. The previous rate was 26s. a ton. Now it has reached about 140s. a ton. My right hon. Friend may question this, but The Times, on 1st and 3rd July, estimated that the total costs to B.P. could be about £100 million. Also, the embargo on British exports to Arab countries could reduce earnings significantly.
I hope that my right hon. Friend consulted other Departments before he made his statement. It is sometimes thought that decisions can be taken in isolation. I have rather emotionally talked about more than 100,000 miners being involved. Some railwaymen may be involved. The railways depend on coal for about 37½ per cent. of their revenue, and I think that it represents about 60 per cent. of their freight traffic. The decision to reduce coal consumption will affect the railway industry. So when we discuss policies such as this railwaymen are entitled to be consulted as well as miners. I do not know whether my right hon. Friend discussed the matter with the Minister of Transport and the railway unions, but those unions are involved, and there are also engineering industries which may be affected.
I do not envy my right hon. Friend in his task, and I do not agree with the kind of policies which have been put forward, but his job as Minister is to try to work out a policy. I believe that


some of the arguments about the costs of nuclear energy and oil may be solved before he issues his White Paper in October. I hope that by then he will have been able to see through some of the fog surrounding the figures discussed in relation to oil, nuclear energy and gas, and will come forward with a realistic programme to ensure that the mining industry will play its proper part in relation to fuel resources.

4.34 a.m.

Mr. Arthur Palmer: During the course of this long night a number of very eloquent and able speeches have been made. There have also been references to the investigation that the Select Committee on Science and Technology is carrying out into the nuclear reactor programme. As I have the privilege of being its Chairman. I thought I might say a word or two which might assist the House in the debate.
In looking at the nuclear reactor programme, the Select Committee has been bound to look at its bearing on the general energy policy of the country and, in particular, on the future correct relationship between the size and the output of the coal industry and the development of nuclear fission as an energy source.
I am doubtful whether anyone in this country is yet in a position to give a true estimate of the relative balance of costs between the two sources. I am not at all convinced that the Ministry of Power or the Ministry of Technology are in a position to do so. My right hon. Friend the Minister is modest and said that he was not a technical expert. I am by training and profession an engineer and I know enough of technical experts to know that they are violent partisans in these matters and there is always special pleading. We should keep this in mind when we seem to think that somewhere there already exists an objective and detached view of the relative cost balance of energy policy. It does not exist.
In the Select Committee we have taken evidence from a number of quarters. I can say this because the evidence has been reported to the House. We have taken evidence from the Minister of

Power and the Minister of Technology, and we have had in front of us the Chairman of the Atomic Energy Authority, the Chairman of the Central Electricity Generating Board, the Chairman of the South of Scotland Electricity Board and last, but by no means least, the Chairman of the National Coal Board. That was a particularly boisterous occasion. The evidence, but not the findings, of the Select Committee has been reported to the House and it would be improper of me to indicate in any way what the findings might be. I have no intention of doing so.
I would like to draw the Minister's attention to the fact that the Committee has worked very hard on the chosen subject and we hope that our report will be available by the end of the Session. We are putting all our energies and efforts to that end. Our report may even be out before the White Paper. We may be able to anticipate the White Paper, which has been rather slow in coming along. The Committee is hopeful that its report will be of value to the House and to the Government, and I trust that the Government will take careful note of its findings.
There is one advantage that the Committee has had over the present discussion in the House. We sat in the true morning, in the full light of physical day. I do not know why, when we have debates on fuel and power, we have the bad trick of tucking these debates away in any odd corner of our business that we can find. The Select Committee by meeting in the mornings to discuss reactors and energy policy, among other things, set an example of starting early which I hope the House as a whole will emulate in the future.

4.40 a.m.

Mr. J. D. Concannon: Sixteen months ago at this time I would have been on my way to the Nottinghamshire coalfield. I was used to working the three-shift system and the only thing I cannot get used to is working the three shifts in one day.
So much has been said about the merits and the cost of oil and nuclear energy that I do not wish to waste the time of the House by going over the same ground again. My reasons for taking


part in the debate are varied. Most speakers have mentioned the Notts coalfield as some kind of El Dorado. As I am chairman and secretary of the "Notts miners' group" in the House—in fact, I am the only Notts miner in the House—I felt it incumbent upon me to say something about the Notts coalfield. But I have to be careful in what I say because I would not like to go down in history as being mentioned in the same breath as Spencer. I do not want to be a Spencer, so I shall pick my words carefully.
Before the debate, some of my hon. Friends said that I could sit back and stay silent, as "I am all right, Jack". Possibly I am, representing the Notts area, but the Notts miners are not the whole National Union of Mineworkers and I want to add my weight in expressing the feelings of the Notts miners with the feelings of the miners in the rest of the country.
So much has been said about the East Midlands Division of the National Coal Board that we should put its record in perspective. We must look at the figures in the light of the Board's policy over the last ten years of gradually compacting the coalfields into Yorkshire and the East Midlands and of the latest statement that the Board is aiming at a 50 cwt. output per manshift by 1970.
We have been told that nationalisation has been a failure. If so, the figures from the East Midlands Division from 1946 to 1967 are remarkable. In 1947, we mined 31,683,000 tons of coal with an average of 94,500 miners. The average output was 30 cwt. per manshift. The number of pits was 102. The mechanical loaded output was only 7·5 per cent. The profit that year was £4·5 million.
The next obvious year to take is 1957, the peak year of production and manpower. Production in the division was 47 million tons, but it took 103,500 men to do it. Output per manshift was 37·2 cwt. We have also suffered from the closure programme. The number of units had gone down by 1957 from 102 to 89. The machine output of the division had slightly increased, to 38·2 per cent. The profit that year was £12·9 million.
The year 1966–67 showed a drop in total output from 1957, down to 42½ million tons, and manpower had dropped from 103,000 to 75,500. The remarkable thing in the division—which produces 25 per cent. of the country's total output—was that output per manshift was 50·9 cwt. We are now down to 70 units. We have had closures and we shall have more. But the truly remarkable figure is the amount of automation and mechanization—95·3 per cent. of the tonnage is mechanically mined. During these 20 years, the division has made a total profit of over £251 million.
These are remarkable figures. I do not want them to be misrepresented. What I am trying to show is what has happened in the East Midlands through the truly remarkable capital investment programme. We have had the funds to do it, obviously. I have worked in the industry during the transitional period from 1954 onwards—from the pick and shovel at the coal face right through to sophisticated machinery. Only a Jules Verne could describe some of this machinery properly. When I first saw some of the machines which men have to work close to, they looked monstrous and terrifying. But they work.
The other truly remarkable feature about the division is that in 1965–6 we only lost 27,000 tons through disputes. This is another fallacy which needs exploding about the mining industry and the disputes which take place. In the "Crater" district of Mansfield, not once have I had to have the protection of a battalion of troops at the pit-head.
I must try and explain what has happened as a result of the productivity increase in the division. It means that the price of East Midlands coal to the Central Electricity Generating Board has not been increased for seven years, and 20 million tons of East Midlands coal is used in local power stations. Recently, the West Burton power station has come into operation, and that will consume 5 million tons per annum. In the next fiscal year, we shall have the Ratcliffe-on-Soar power station coming into operation, and that will consume another 5 million tons. Then we shall have Cottan, which will also consume East Midlands coal.
If one adds to the East Midlands Division the Yorkshire total, one finds


that, over the past seven years, East Midlands coal has remained static in price, while the price of Yorkshire coal has increased by only 7s. 6d. per ton. As a result, 36 million tons, or 60 per cent. of the coal supplied to the C.E.G.B., has increased in price by one-sixth of 1d. per therm. East Midlands and Yorkshire coals are being supplied to power stations in the coalfields at just over 3½d. per therm.
That does not mean to say that we have no troubles in the area, because we have, though my problems are vastly different from those of my colleagues in the rest of the industry. My area is possibly the only one which is on the "up" in a declining industry, and that very fact brings its own problems, of course.
To take housing as an example, the Coal Board owns 23,594 houses and is building between 500 and 1,000 more this year in the East Midlands Division, largely because of its attitude towards redeployment. Living in those houses are young men from such areas as Derbyshire, Scotland, Durham and Wales, and they are bringing added problems. Their presence means that North Nottinghamshire is in for a terrific boom in population in the next few years. That is only too obvious, because we are taking the younger families of the Scottish. Durham. South Wales and other coalfields.
Another of my big problems is the shortage of manpower. My area is a profitable one, having made £261 million in the last 20 years. Only this morning, I received a report from the Ministry of Labour office in Mansfield indicating that there are over 1,000 vacancies. Unemployment is virtually static compared with the figures last year, before the July measures. The Mansfield Employment Exchange has 731 vacancies in the local mining industry. That is the paradox of the situation, as a result of which I am at times in great difficulty. The need for confidence in the industry has been stressed. Even with figures like these, confidence, even in my area, sometimes leaves something to be desired.
My greatest difficulty at week-ends is in correcting the speeches and statements made by individuals and organisations who should know a little better. Not long ago, I had to listen to a speech from a

local dignitary and industrialist who probably did more damage in five minutes to the local industry than I could hope to achieve in a lifetime. He was uttering the death rites on an industry which, over the last 20 years, has made a profit of over £250 million and which, obviously, would not be touched dramatically by any fuel policy which the Government or anybody else might be thinking up.
Between his moanings about his profit margins and the Government stopping him from making a vast figure on land deals, he seemed to me to be showing concern about the mining industry. It took me a little while to fathom what he was on about. Had he been bothered about the men and their jobs, that would have been all right with me, but seemingly his only complaint was about what the miners got in their pay packet at the end of the week and what would be his share of it. That shows the extent to which morale around the industry has fallen, even in the East Midlands. We must rectify this quickly.
Wherever we have the fortune to live or mine, it is simply a matter of the turn of the card that Nottinghamshire has the best working conditions and tremendous capital investment of many millions of pounds. A figure of £9 million or £10 million for each individual unit is not unusual.
I well foresee the position that we in the East Midlands and Nottinghamshire may come up against in the year 2000. I would not like to have the problem of dealing with it, as my hon. Friends do every weekend when they go home. Obviously, the men who are no longer needed must be redeployed in advance factories or elsewhere when the industry no longer wants them. We must review the position in plenty of time to find new and better jobs in the economy for those men.
Most of the important points have been covered by many of my hon. Friends and I can, therefore, dispense with a lot of my speech. Over the last 10 years, we have lost through wastage in the industry over 300,000 men. By 1970, if we carry on as we are, we will lose another 100,000 by natural wastage alone. I do not find that a bad thing by itself, however. I come from a family with a long tradition in mining. It has


had its share of tragedy, disease and accident. I derive no satisfaction from the fact that men still have to go down the mine. I hope to live to see the day, which I project at 30 or 40 years' ahead, when no man has to go down any mine.
In these days of technical advance, I see this happening in about the year 2000, not at the present time, as the hon. Member for Orpington (Mr. Lubbock) seemed to suggest. I understood the hon. Gentleman to say—and so did my hon. Friend the Member for Chesterfield (Mr. Varley)—that he wished to run down the industry as quickly as he could. I know that the hon. Gentleman has corrected his statement, but the inference that I drew—

Mr. Lubbock: I said as quickly as was economically and socially practicable. I agree with everything the hon. Gentleman has said. It echoes my view.

Mr. Concannon: I am glad that the hon. Gentleman has corrected his statement, because what I heard him say amazed me. At the last Liberal conference my constituency was singled out by the Liberal Party as one of the industrial seats on which they should "get cracking." If I were to expound the Liberal philosophy of closing down pits in the area it would do me a shade of good.

Mr. Lubbock: I must correct what the hon. Gentleman has said. I have not corrected my statement. I have repeated what I said at the beginning of my speech. If the hon. Gentleman does not believe me, he can check it in the HANSARD room.

Mr. Concannon: I was amazed when I heard what the hon. Gentleman said. I know that he has corrected it since. I do not know how one corrects HANSARD when one goes there, but I shall be amazed if I am wrong. It shocked me so much that I could not possibly have misunderstood what the hon. Gentleman said. I nearly challenged him when he said it, but if he has corrected it I will leave the matter there.
My protest is that there has not been a peep from anyone, either tonight or at any other time, that if the time comes when the nation does not require the services of these fine men in the mines, the phasing out and the provision of

new sources of employment must be done in such a way that a job and a decent standard of living are theirs by right. This is not too much to ask of a Labour Government.

4.57 a.m.

Mr. Edwin Wainwright: We have met tonight to talk about the Coal Industry (Borrowing Powers) Order, 1967, to give permission to the National Coal Board to borrow another £50 million above the normal figure. I understand that some of this money will be spent on the stocking of coal. This is a shocking thing, because money that is borrowed has to be repaid. This means that the interest to be paid on the money is a further burden on the industry, which makes it more difficult for the industry to become viable.
I think that the money ought to be utilised for some other purpose, and that someone else ought to take over responsibility for the stocking of coal. If we do not stock the coal, we will have to close the mines, and if we close the mines we will cause social chaos. For this reason the Government ought to look a little further and take over responsibility for the stocking of coal.
I understand that we stock oil in this country. I once asked the Minister what quantity of oil we stocked, and what this cost. I was told the cost of stocking—I think that it was about £4 million, but this was several years ago—but I was not told the quantity, because this information had to be kept a State secret. I wonder how much of that £4 million was for the benefit of private industry which could draw upon those stocks from time to time.
We should know whether this has been done because of the present situation in the Middle East. If private industry can be helped in such circumstances, we should be able to help a public industry which has difficulties in making itself viable. A fuel policy should be based on indigenous resources, and imported fuels should be complementary. It would be foolish to say that coal should be produced regardless of the cost, but our fuel must come from secure sources.
We are relying on oil too much and have done in the past, and, although the present difficulties might be overcome, if we depend on it too much we might


be placed in an invidious position. We must consider the political instability of the area that oil comes from. I hope that my right hon. Friend will note that it is not a question of coal versus nuclear power, but of indigenous fuels against oil. Large quantities of oil must be imported, despite the balance of payments, because of its by-products and because it is vital to industry, but I hope that we will not run down the mining industry so much that oil will increasingly supply the greater part of our fuel needs.
When criticising the present situation of the industry and the Government help which it receives, we should examine the social responsibilities of the Coal Board. Its financial difficulties are caused not only by capital costs, but by interest charges, which become heavier as time goes on. I do not disagree that the Board should bear the cost of subsidence, but the figures should be given to the House, because the public ought to know. I understand that it is now about £5 million a year, which is a cost which private industry never bore. It is ridiculous that the Board should have to spend £3·8 million a year before it can get its £ for £ of the £30 million allocated for social responsibilities. This should be ended and the Government should stand every penny for the transference of men, the moving of their families and other factors.
Many people, probably because of their education and professions, easily adapt to change and freely move from one area to another. But the people about whom we are talking are not used to moving home. Often they resent it. Different mining areas have different patterns of employment for women and youngsters. About 10 bus loads of young girls leave my constituency every morning. These youngsters travel 15 to 20 miles a day to work and make that journey home again at night. In other mining areas it is impossible for the women folk to obtain work, even if they are prepared to travel these distances.

Mr. Alan Beaney: Is my hon. Friend aware that the Minister is not on the Front Bench?

Mr. Wainwright: I am. However, he has a good deputy in the Parliamentary

Secretary and I am sure that my comments will be passed on to my right hon. Friend.
Much has been said about an alleged statement in which the Parliamentary Secretary is said to have spoken about 120 million tons of coal being produced. Apparently the figure of 80 million tons was then mentioned. There has been some dispute about that statement. I recall a statement being made by a previous Minister of Power about the increased number of pits to be closed by the Coal Board. Although the Board had been closing pits for a number of years, without any trouble being caused, as soon as that statement was made people were up in arms, men flocked away from the pits and morale sagged.
It is easy for back benchers to make statements, but Ministers must be more careful. Great attention is paid to what they say and I mention this to the Parliamentary Secretary so that he is careful in future about the statements he makes.

The Parliamentary Secretary to the Ministry of Power (Mr. Reginald Freeson): Not for the first time am I making the position clear. The statement attributed to me on the occasion to which my hon. Friend is referring was inaccurate and was never made.

Mr. Wainwright: I am glad to have that denial. Evidently the Press wrongly reported my hon. Friend.

Mr. Beaney: Is my hon. Friend challenging the Parliamentary Secretary?

Mr. Wainwright: No. The Parliamentary Secretary has denied making the statement, and that is good enough for me.
The coal industry is entitled to know more about its future. Whether it will be allowed to produce 120 million tons or 155 million tons does not mean a great deal.
It has been said that the industry could produce 180 million tons of coal, but the problem is to sell it. If the Government do not intend to help the industry to sell the coal, it is no good their making wild statements. Production of 155 million tons can be achieved, but our worry is whether we will be able to sell it if oil is to be allowed to run rampant and we get natural gas from the North Sea to the


extent we have been told. I therefore hope that financial help will be given to the industry.
It has also been said that the electricity generating industry must take more coal. I hope that that will be done, but if taking more coal adds to that industry's costs, it will not be fair. Members of the Opposition are continually seeking opportunities to criticise nationalisation. To use one nationalised industry to help another in this way would not leave us with an industry that was as viable as it could and ought to be. We would then provide more grounds for criticism.
If these four industries were run by private enterprise, each would help the other out, but if we say that each must be separate and apart that is where the Government must come in and make up the difference. My hon. Friends may not agree with me on this, but I believe that it is the Government's duty to help the industry so that, through reorganisation, it becomes more viable and competitive with other forms of fuel.
I differ from some of my hon. Friends on the subject of nuclear power. I very firmly believe that in the next two decades nuclear power will be the cheapest way of producing electricity—

Mr. Beaney: How does my hon. Friend know that?

Mr. Wainwright: I know that, occasionally, a good many things that promise well are not fulfilled, but when I look at the progress that has been made in this case I believe there will be a progressive cheapening in the production of electricity by nuclear power.
I agree that seven magnox stations in operation were too many and that five or four would have been enough. Nevertheless, there has been a tremendous amount of technical know-how gained from the building of those stations. I am quite certain that the building of three A.G.R. stations will be enough to provide the "know-how" we need of that system. The fast breeder is the thing of the future, but it will take at least five years from the start of the first for it to become critical. Only then can we appreciate the teething troubles of a nuclear power station of this kind. To build five in five years at terrific cost is asking too much. I ask my right hon.

Friend to look again at this problem. To build one in the midst of a coalfield is the utmost folly. It is saying to the men in that coalfield, "In five years' time you will be obsolete". If it is necessary to build it, it should be built somewhere away from a coalfield.
Looking at the critical situation in the Middle East and the Far East, with the growing power of China, I think that during the next two decades the sources of oil will probably be depleted. For that reason we should look carefully at the amount of oil that we import and what proportion it should supply of our total fuel needs. We should concentrate on a secure source of fuel before considering other sources. We have had enough trouble with Arab countries recently and such trouble can become greater as time goes on.
If my right hon. Friend has had an easy time this night, he must not take it for granted the section of mining constituency Members will always allow him an easy time. We have tremendous respect for his ability, but we are sometimes a little doubtful about his conduct in regard to the mining fraternity. This will depend on what happens in the next few months. We shall watch him carefully. If he does not bring out a fuel policy which will take account of the future welfare of the men in the coal mining industry, he will have to face greater criticism than he has had on this occasion.

5.17 a.m.

Mr. Clifford Williams: I have listened to the many eloquent and passionate appeals of my hon. Friends backed by statistical evidence for the preservation of this great industry. I declare my interest. I have four brothers working in the mines and until I was elected to this House just over two years ago I spent 45 years in the pits. I can bear witness to the savage, ruthless and desperate conditions in which we laboured and to the shocking toll of life and limb throughout that dreadful period when the coalfields, under private ownership, were not worked but were raped and plundered by grasping and unscrupulous owners for private profit when all the rich seams were exhausted.
Despite those happenings, and the miners' sufferings, the nation must never be allowed to forget that with all due respect to other trades and industries this great industry has been for decades the foundation of the country's prosperity. Our coalfields are the gift of nature to benefit the nation. It is to our national advantage that the industry shall thrive and not perish.
We have been told in many quarters that the world does not owe us a living. This we can accept, but let it be clearly understood that the nation owes the miners a living. They have justly earned their right by their sacrifices, by their contribution to the nation's wealth, and—let us not forget—by their tolerant and moderate demands. If it had not been for their patriotic loyalty, and had they accepted the principles of free enterprise as advocated by hon. Members opposite and followed the law of supply and demand from 1948 to 1956, when miners were exhorted to produce every ounce of coal, when there was a national and, indeed, an international shortage of coal, they could have held the nation up to ransom and provided for themselves better pay, better pensions—not the miserable £1 a week after 50 years' work in the darkness of the pit—and, above all, security of employment for many years in the pits in their towns and villages. That is why we miners strongly contend that the nation does owe us a living.
Since 1947, 127 pits have closed in the South-Western Division, 22 pits have been merged, and nine completely new units have been developed. It is fair to say that, through co-operation between trade unions, the Board, the men, and officials the great majority of the men made redundant were placed in other collieries. As one who had long experience of negotiations with the former colliery owners and latterly with the Coal Board, let me place on record my unstinted appreciation of the officers of the Board with whom I had to work for their warm and sympathetic understanding, for their humane administration, and again for their expert and efficient management. Indeed, they needed all their skills to repair the rottenness and the plundering of the collieries which had been going on for years.
We ask: have they succeeded? The answer is that in successive years increased production figures have taken place year by year. While we have accepted contraction of the industry and the technological changes in the industry, we now believe that a halt must be called to any further contraction. If more collieries are to be closed, it is becoming increasingly difficult to provide employment for men made redundant, and especially so for men in their 50s and the partially disabled. This is the time when miners, after a lifetime of service to the industry, when their pit is closed become bitter and their souls are soured.
I have a letter dated 13th July informing me of an impending pit closure in my area. This, I know, will bring a feeling of gloom to the men concerned, to the traders in the town, and finally to the local authority because of the loss of rating precept to the area. If these closures are allowed to continue and no alternative industry is provided, we shall become ghost towns and slowly but surely wither away and die. This must be prevented at all costs, to arrest the social loss and the misery that follow.

5.24 a.m.

Mr. Michael McGuire: My colleagues have spoken with great emotion after listening to my right hon. Friend the Minister's introductory speech. They have no need to apologise for the fact that emotion has been aroused in them, because what has been said by some tonight makes this a very sad night indeed for those who look with some fondness on the concept of the mining industry getting over the hump.
Whatever I say about my right hon. Friend the Leader of the House behind his back, I am one who likes to say kind things to his face. I think that he made a wise choice in starting this debate at ten o'clock at night. When I go to the Pearly Gates I shall be absolved from some of my sins because I always have to wait till the last, and I hope my hon. Friends will not mind when I say that sometimes it is a little hard to bear. I have always been left till the last. I appreciate that I am a junior Member of the House, although some of my equally junior colleagues seem to be called before me. However, if this debate had not begun when it did, back bench Members would have


had, at the most, four or five chances to get into the debate. Therefore, I think that my right hon. Friend made a wise choice.
I hope that we debate the subject of coal often. We certainly look forward to the White Paper, and I hope we have plenty of time in which to discuss it. My only regret in the present debate is that it looks as though we shall have to curtail our enthusiasm because more business will be coming up at ten o'clock this morning. This may be a bit of a tragedy for some; but anyway, I have got into the debate.
One reads of speeches influencing other men. It was said of Thomas Jefferson, that great American, that he never made a speech because he hated the morbid rage of debate. He believed that men were never convinced by argument, but only through reflection, through reading, or unprovocative conversation. This belief guided him through life. I should like to paraphrase what my right hon. Friend told us earlier in the debate by saying, "To convince a man against his will, he is of the same opinion still".
My right hon. Friend has gone a long way to accepting many specious arguments which will destroy one of our greatest assets. I believe that with all the conviction at my command. In introducing this Order my right hon. Friend said that events since 1965, I repeat 1965, had made the Order necessary, because it was originally intended to be brought forward in 1971. I took him up on this question of the infallibility of the so-called experts, referred to by my right hon. Friend the Member for Easington (Mr. Shinwell), who said that he himself had been led astray by experts. These people are not infallible. Certainly, in their advice on the question of nuclear power they have been miles off the mark. We have no guarantee now that they will not be miles off the mark again. In fact, it is more than likely that they will be. I urge my right hon. Friend to question these matters very closely.
Although I do not want to he regarded as general secretary of a society for the prevention of cruelty to Lord Robens—though he seems to need it sometimes—I believe that he has studied these things to far greater depth than some of the

so-called experts. His opinions should be taken into account.

Mr. Edwin Wainwright: Mr. Edwin Wainwright rose—

Mr. McGuire: Let me get full steam up first, and then I will give way.
My right hon. Friend made what he called an interim statement. I regard it as the most important made by any Government for many years, because the worst fears of many of my right hon. and hon. Friends have been confirmed. It means that, within only a few years, we shall witness the decline of an industry which was largely responsible for this country's past economic greatness. I realise that we cannot keep on parading the past contribution made by the miners, though there is no harm in reminding the House of it and, even if it does not do a lot of good, we can derive some satisfaction from it.
My hon. Friend the Member for Abertillery (Mr. Clifford Williams) spoke eloquently of the contribution which the industry has made over the years, and those of us who know the industry in one way or another, through our constituencies or through having worked in it, do not find it easy to accept the sort of statement which my right hon. Friend made today.
I say to my right hon. Friend, with great charity, that an Order of this sort introduced not in glib fashion—it would be unfair to say that—but in what I considered too casual a fashion, telling the industry that it will be written off—that is what the Order means, in essence—is hard to take. This is an industry which has suffered more than its fair share of
the slings and arrows of outrageous fortune",
an industry the history of which can be said to have been written in blood, sweat, toil, tears and man's inhumanity to man.
People may say, "Why do you want men to continue in an industry which is like that?". Curiously enough, many men like working in the pits, and for a great many more it is the only opportunity they have to sell their labour with dignity. It is an industry which, under nationalisation, has many great achievements to its credit, the greatest of all being that it has shown that we can have safe working conditions which encourage the safe and efficient getting of coal.
I am told that the injury rate is proportionately a little higher than it was, though the actual number of injuries is smaller because the men are fewer. But the death rate is vastly improved. We used to have 1,000 men a year killed. Under nationalisation, it has dropped to 240. That is 240 too many, of course, and some of them occur in tragic accidents when more than one man is killed at a time, but it remains true that the reduction in the death rate has been one of the great achievements of the industry. I am sure that its record stands highest among all coal producing countries.
Although mining is still a dangerous, dirty and, to some extent, a socially disesteemed industry, for quite a lot of our fellow men it is the only opportunity they have to sell their labour. I wish that the Coal Board could have got over the hump, but it had the closure programme thrust upon it, and now this further one which when we cut through all the waffle and verbiage, as my hon. Friend the Member for Midlothian (Mr. Eadie) pointed out, means 100,000 men to be displaced. Our record in retraining men is pathetic, to say the least. We shall not be able to accommodate that number.
I believe that commercial considerations have been forced upon the Board, and they have been since 1956, although such considerations were never applied when they would have been to the Board's advantage. From 1947, when the mines were nationalised, until about 1957 the miners could have held it to ransom, but they did not. As I have said before, it is curious that they had Communist leadership. We have always historically had a Communist general secretary, and nobody could accuse Arthur Horner of being a milk and water Socialist. He told the miners that they could demand the moon, that they could be like Samson and destroy the temple of nationalisation. But he said that they had done so much and had so much to gain from nationalisation as miners they must take it easy. He said "Our just demands will be met in the fullness of time. We have a duty to the nation." That was always the advice given and accepted.
The miners were exhorted to work on Saturdays and extra shifts, even

though they had a five-day week—a prized possession. They did not pursue their demands to the full extent of their economic power. They got scant thanks from the Labour Government, and their thanks look like being a little skinnier after what we have heard in this debate. The coal industry was not allowed to act as a commercial enterprise. In the interests of the nation it had to plan repeatedly for a capacity that was always higher, and when it looked like being reached new fuels were introduced because there were shortages. That has been thrown back in the faces of the miners and it has been said that they failed in their duties to some extent.
My right hon. Friend said that he will introduce in the autumn a White Paper on future energy demands. I will bet any odds that apart from the name "White Paper", it will have one thing in common with all the others—it will be wrong. All the previous White Papers have been wrong. We have only to refer to the most recent, that of 1965, which was miles out, to see that.
I repeat my warning that we should look very carefully at the forecast demands. We are told that one of the reasons why we must bring forward the powers from 1971 is that the Coal Board has a tremendous stock of coal. It is said that distributed and undistributed stocks total about 40 million tons. I declare an interest—I am one of the 52 million coal owners.
My right hon. Friend has asked miners how he can get rid of the stock of coal. I will tell him what to do. It will not disappear overnight, but we must bear in mind that it largely results from Government policy not based always, or even at all, on sheer economic considerations. In other words, it has been there largely because we have had unproductive, uneconomic capacity in our generating stations in the form of nuclear energy, as an example. This has meant that many many millions of tons have accumulated on the floor.
It has been said that 6 million tons will be taken by the C.E.G.B. Probably it will groan, but let it. If I had my way it would groan more, and so would the gas industry, to a certain extent. It was supposed to take 300,000 tons. I do not know whether it did. The Government must instruct the C.E.G.B. to alter


its present preference, which hits coal. In other words, it is not using as much as it should. It should quickly use some of the stocks of coal.
At one stage I said that I wanted to interrupt my right hon. Friend, and he said that he had not enough steam up to give way, or words to that effect. I did not pursue the point. Mr. Speaker was keen on short speeches and no interruptions. But I wanted to ask my right hon. Friend about oil. He mentioned that a preference was given and that some disability was put on oil. How will he explain away the fact that, notwithstanding the Middle East crisis, we are using more oil today, on the basis of the last available figures in June, than we have ever used, and at a time when there are great dangers about guaranteeing supplies from the Middle East? Oil is one of the things that we can look at. It is still continuing to displace coal. Also, nuclear energy has displaced millions of tons of coal.
I turn to the merit rating operated by the C.E.G.B. Notwithstanding that this is the most favourable time for nuclear development, it is more than twice as dear in capital cost to build a nuclear station as it is a conventional station. The ground rules which operate on load factor are very heavily weighted in favour of nuclear power to the detriment of coal. Therefore, I believe that the costs of coal are artificially inflated. This situation should be remedied. It would be one way of balancing the budget a little and would get rid of some of the 25 million tons of coal that the Board supposed to have in hand.
I turn to a point skipped over easily by my right hon. Friend. Miners Members are sometimes accused of running a vendetta and being Luddites in relation to nuclear energy. I can make my attitude clear on this, as all my hon. Friends have made it clear. We welcome the advent of anything which, economically assessed and analysed properly, will give the country cheap energy. We do not need to state the reasons for it. It will give us a favourable economic position, bearing in mind that we have to live by exports. But the new source of power must be assessed as rigidly economically as coal is being assessed. In other words,

it must be scrutinised far more rigidly than it is being now.
In his 1965 statement my right hon. Friend the Member for Newton (Mr. Frederick Lee), who was then Minister of Power, christened the new A.G.R. when he allowed it to go on; his words were, "This is a real break-through; this is it." But since that time—this reinforces what I am saying and what my right hon. Friend the Member for Easington said about not accepting the experts too much at face value; and I emphasise that that was only two years ago—the costs on any reasonable and prudent assessment are up 25 per cent., while the costs of conventional provision are up hardly at all. There is still four years to go of this most favourable Dungeness B assessment, and yet the cost has risen.
Furthermore, although we welcome nuclear power and look upon it as a necessary experiment, as my hon. Friend the Member for Midlothian said, do not let us repeat the mistakes with the Magnox stations. We are to commission two magnox stations, technological white elephants which cannot produce power as cheaply as conventional stations can. This shows how barmy the attitude is. Can anyone wonder why there is criticism of the decision to go ahead with these?
We are to have two Magnox stations which will not be competitive because too many stations were commissioned in the first programme. We find that when we try to get information about the nuclear stations we have to drag it out. I would not say that deliberate falsification has occurred, but all the figures were not put on the table right away. I am referring to the fact that the figure of 0·52d. was given by the Parliamentary Secretary in answer to the hon. Member for Dorset, West (Mr. Wingfield Digby) on 2nd March, 1967. There was the 25 per cent. increase coupled with the working party's figures.
This was never included until the hon. Member for Dunfermline Burghs (Mr. Adam Hunter) asked about the royalties of the Atomic Energy Authority from the C.E.G.B. It is only a small amount, but when one is talking about 0·014d. multiplied by about a million the amount adds up. My hon. Friend the Member for Dunfermline Burghs asked a Question of the Minister of Technology and drew


out of him that this represented only half the cost. Administrative costs and research costs are not being passed on to nuclear. If this attitude is contrasted with the fact that the coal industry has always been subjected to real scrutiny one becomes convinced that the Minister of Power has had the three card trick played on him by people who may not be anti-coal, but who are certainly pro-nuclear. They felt that they could quietly get rid of the coal industry.
I hope that the Parliamentary Secretary will be able to answer the questions I have deliberately put to him about why the nuclear cost had to be dragged out.
It has been said that the working party was set up by the Minister of Power to examine the proper cost of the nuclear programme and that its estimate represented the most pessimistic forecast. I do not think that it did, because the working party was made up of experts and members of the Coal Board who were admitted to it, albeit late, after they had "kicked up a stink".

Mr. Eadie: I put a question about this to the Minister of Power and the reply I got was that I should not believe every bit of gossip I heard.

Mr. McGuire: I remember that, now that my hon. Friend has reminded me. I know that my hon. Friend shares with me a lack of enthusiasm for accepting figures from Ministers.
The capital cost of the second nuclear power programme will be about £300 million more than the cost of generating the power by conventional methods. The cost of nuclear power and the cost of conventional power are very evenly balanced in the latest authentic figures.
I am delighted that two members of the Cabinet are present. We are told that the Cabinet is engaged in deciding what Government expenditure should be pruned. We are told that, in the present economic situation we have to be prudent. We are told that we cannot go on with our committed programme. But here is an area where we can save a lot of money.
We should see that the first mistake on the nuclear energy programme is not repeated. My hon. Friend the Member for Dearne Valley (Mr. Edwin Wain-

wright) suggested that we should stop at the present number of nuclear power stations. Surely we now have enough technological spin-off from them already. Let us build conventional stations and give them a chance to be competitive, as we believe they are.
If the members of the Cabinet, in their wisdom, burning the candle at both ends arguing among themselves, with each Minister looking to his own corner, seriously mean what they say, they should look at the £300 million extra capital involved in the second nuclear programme. We should have placed before us the full costs of this technological advance.
While there may not be an anti-coal element in the Cabinet, I believe that there is a pronounced pro-nuclear one. Listening to the apologies for the nuclear programme, one realises that it has not lived up to the great hopes placed in it, as Sir William Penney has said. He made the case that coal costs had risen far more steeply than any other comparable costs. He let the cat out of the bag. The capital cost of conventional power stations was over-estimated and this, together with the technological advances in them, makes them cheaper all round.
There is the new technique of fluoridised beds which should be encouraged with the same enthusiasm as the Government are going hell-bent for the nuclear programme. I am told that we could make savings of 8 per cent. in cost. I hope that the Government will examine this, for it is essential that they should at least be fair and give as much aid and as much chance to conventional generation as to nuclear generation. My right hon. Friend and all his predecessors have said that the mining industry has a glorious future and will always play a great part in supplying our energy requirements.
If I may introduce a little humour into the debate, I am reminded of the American judge who sentenced an old lag of 75 to 99 years in the State penitentiary and then asked him if he had anything to say. The old man replied, "A 99-year sentence? But I have rheumatism, a bad heart and arthritis, and I am 75." The judge said, "I know, but do as much as you can." That is the kind of patronising attitude that the Coal Board has adopted. It says, "Do as many years as you can."


The analogy with rheumatism is the social consequences for which the Board has to bear responsibility. "Do your best", it says.
Hove can my right hon. Friend say that there is a rosy future for coal mining when there is not another conventional power station beyond Drax—

Mr. Marsh: I want to kill this "rosy future" story before it goes any further. Reference has been made to my saying that we have had our difficulties, but that we now have a rosy future ahead. My speech was divided into two parts. The rosy future and the difficulties which we have had referred to the Labour Party. It was not a reference to the coal mining industry.

Mr. McGuire: I will give way again to my right hon. Friend if he can answer this question. How can he say that there is any future? It certainly will not be a rosy one. "Nye" Bevan used to say, "Why gaze into the crystal when you can read the book?" We can all read the book, and we know that in my right hon. Friend's White Paper there will be a reforecast of the 100 million tons envisaged. How can he say that there is a future, even on the basis of 80 million tons? I think that we can say "Goodbye" to the prospect of a viable coal industry.
If we have no conventional power station planned beyond Drax, coupled with the fact that the merit rating is against the burning of coal, how can my right hon. Friend say that there is a long-term future for the mining industry?
I think that it is essential that Seaton Carew is directed to be a conventional power station. It will be the Coal Board's Waterloo if the station is not coal-fired. My right hon. Friend said that social and other considerations would bear heavily on a decision one way or the other. I believe that, even if the costs are evenly balanced, social considerations should swing the balance in favour of coal for Seaton Carew.
In private and public meetings, my right hon. Friend has urged that we should not do anything to create low rnorale in the industry. He says that we must do everything as Labour Members of Parliament to keep morale as high as possible. To give Seaton Carew to coal

would not merely be logical, but would be a tremendous boost for morale in the Durham coalfield.
Lord Robens, who has put up a courageous fight, has said in so many words that if we want an industry of merely 80 million or 120 million tons and judge it solely on commercial considerations, we can get a computer to do it. We do not need a Chairman of the Coal Board to feed in the information.
A former member of the Labour Government and a distinguished member of the Parliamentary Labour Party, Lord Robens must be aware of the social considerations of closing collieries. Some of us on this side have said that his argument for 200 million tons was to some extent unrealistic. Certainly, the Conservative Government, but, more importantly, our own Government, where the blame must be laid, did not take the necessary steps to consolidate this figure.
In my humble way, I endorse Lord Robens' argument that if we contract the industry further, we will put an ever-increasing burden on the coal price and within a short time there will not be an industry. With great courage, Lord Robens has outlined his campaign. The industry needs his leadership. I hope that he continues to lead it and that we redirect Government policy so that we do not go further down the line past the 155 million tons level but have a chance to come back.
With the new methods and improvements which are coming into the pits, given stability and the chance to overcome the hump, I believe that, prior to my right hon. Friend's statement, coal had a very good chance of becoming a better industry, able to give to those who work in it greater rewards to make it a less dangerous industry by taking the steam out of manual labour. That was the way it was going. We could have had an industry of which to be proud.
My hon. Friend the Member for Midlothian said that we are talking about the jobs of 100,000 miners. Whatever we say about the Order, my right hon. Friend the Minister is a humane and good Minister of Power. He has been faced with decisions, and he has taken advice which I would rather he had not taken.
I echo what my hon. Friend said, that it means the end of the Scottish coalfield. I suppose it means the same for the South Wales coalfield. My hon. Friend the Member for Wigan (Mr. Fitch) who belongs to a Trappist order while he is a Member of the Whips' Department, and, therefore, cannot speak in this debate although he would like to, my hon. Friend the Member for Liverpool, West Derby (Mr. Ogden) and I are three Lancashire miners' M.P.s without a pit between us. I have a few drifts, what we call "Day Eyes". These are the only collieries that I have, so we as Members will not be affected to the same degree as will those who represent mining constituencies. But, as my hon. Friend the Member for Mansfield (Mr. Concannon) said, we do not look at the problem merely from the point of view of how we will be affected. I have never seen these benches so full of hon. Members who are interested in this problem, and I pay a particular compliment to those who felt, and still feel, that miners' M.P.s should take part in this discussion.
I appreciate this, and I refer, in particular, to my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot), who would have made a far better speech than I can and entertained the House with real oratory. I am glad that he is here now and that he has heard most of the debate. My hon. Friends consider this matter to be of tremendous importance to them. This is shown by the way in which the House awaited my right hon. Friend's statement.
The Coal Board was reorganised in November, 1965. A White Paper was issued, there was a statement about the finances of the Board, and then we had the speech of the then Minister of Power, my right hon. Friend the Member for Newton, who told us that there was a great future for the coal industry. He said that we were going to produce more coal than any other European country. He told us that the finances of the Board were being reorganised on the basis of producing about 170 to 180 million tons of coal a year, though everybody thought that the figure would be 170 million.
If we reorganise an industry, and say that it should have a target of 170 to

180 million tons, and then not quite two years later we give it a lower target, should we not again reorganise its finances? If an industry invests capital to produce 180 million tons of coal a year, and the figure is then cut to 80 million tons, the industry is faced with a financial burden which is likely to put it out of business.
Under the 1965 Act, £30 million was tied up in the industry to assist with social costs. In answer to Questions in the House last week, my right hon. Friend emphasised that he was proposing to consider what to do with this money. It is to a large extent dead money. Would not my right hon. Friend agree that the social costs which the Board has had to bear, even the rate of £3·8 million, should be wiped away, and we should relieve the Board of this obligation? We should relieve it, too, of those responsibilities which are really outside its purview. I am thinking particularly of the Board's obligation to help men who retire at 55. The die is cast. Our worst fears will have been realised by the time that we have our debate in the autumn after the publication of the White Paper. There is still time to make the industry one to be proud of by giving it its proper appreciation on grounds of economics and national security. It could still cope with the demand and give its workers a fair reward.

6.11 a.m.

Mr. Alec Jones: If I did not speak, even at this hour, I would fail in my duty to my constituents to emphasise the disastrous consequences of accelerating pit closures without providing alternative employment. The technical and financial arguments for the industry's place in a national fuel policy have been well advanced and my hon. Friend the Member for Ince (Mr. McGuire) spoke with humour, sincerity and knowledge.
Young boys are reluctant to enter the industry. Before March this year, I was a school teacher. This is the first time that Rhondda, West has been represented by a non-miner, which shows how the industry has run down in the South Wales valleys. When I asked a class of boys ten years ago how many were going down the pits three-quarters would raise their hands, but when I asked in February of


this year, not one did so. This is significant: their parents, who are miners or ex-miners, see little future in the industry over the next few years. This attitude can only make less viable the so-called long-term pits, which are still considered viable.
I would have liked the proposed £50 million increase in borrowing powers raised and spent by the Coal Board on repairing the ravages of mining in areas like the Rhondda. Many have advocated that the tips and the old colliery sites should be cleared for industry or housing, or restored to their former beauty, but it is too much to expect the community which has suffered from mining to bear any part of the cost.
I welcome the Minister's proposals to make better provision for older miners who are declared redundant. During the short period I have been in the House many cases have come to my attention and they reveal the excellent job that is being done by the N.C.B., but much more needs to be done. For example, a fortnight ago a redundant miner aged 59 came to see me in my "surgery". He told me that he had worked in the coal industry for 45 years but was not entitled to concessionary coal. No nationalised industry should allow this state of affairs to exist.
Hon. Members have referred to the need for a new industrial structure to be created in the old coal areas like my constituency. This can only be achieved by the active co-operation of the Minister and his Cabinet colleagues. My hon. Friend the Member for Rhondda, East (Mr. G. Elfed Davies) referred to this as an urgent matter. For the Rhondda generally it is a matter of top priority if we are to maintain, as the people of the area want, the viable communities of the Rhondda valleys.
The Government have embarked on a policy of giving massive inducements to industrialists to create new factories—and, thus, a new structure—in the Rhondda and elsewhere. But persuasion is proving both slow and inefficient. It is the duty of the Government to repay the debt which the nation owes to the old mining communities by introducing new public enterprises to replace the old industry of coal.

6.17 a.m.

Mr. Adam Hunter: This being one of the most crucial debates in the history of the coal industry, I had prepared a considerable speech. At this stage in the discussion, hon. Members have already mentioned many of the points I had intended to raise, which has meant the complete erosion of my speech. I will, therefore, mention only a few points which may be of interest to the House.
When praising the Minister's statement, several of my hon. Friends have said that reasonable assurances were being given to the coal industry. I hope that they are firm assurances and that they will not be perforated at a later date. The speech I had prepared was pessimistic and critical. I still have no cause to be enthusiastic, even with my right hon. Friend's statement.
I have always taken the view that the problems of the coal industry today stem from the fact that former Conservative Governments and the present Government have given the alternative fuels their head. This is the basic reason why many of the declining coal areas face so many problems. We in Scotland have many problems, and we have suffered drastically in the past eight or nine years as a result of the run down of the coal industry. The industry in the central West Fife area has been almost obliterated, and the last of 20 pits will go in September of this year. We in Scotland are very gravely concerned about the Government's policy for the industry, and the Minister's statement brings me no solace.
We have been told that nuclear power will be the cheapest form of power within the next ten years. My hon. Friends and I do not agree. We are only laymen, but we have been putting searching questions and seeking information here and there, We still feel that the second nuclear programme is too ambitious and too wasteful of the country's capital resources.
We are greatly concerned also about the social costs to the industry. We believe that the 1965 agreement was bad because in the end it meant that the National Coal Board was expected to pay £49 million for this item against £30 million contributed by the Government. That is all wrong, and I was very


pleased to hear the Minister say that he intends to give the whole question his very careful consideration.
The Minister has always said what was happening to the industry, and it has always seemed to me that there was a battle being fought between the Government and the Coal Board, with the mining trade union standing on the sideline awaiting the outcome of the struggle but without any chance of directing the course of that battle. That is wrong, and the union recognises that it has been far too quiescent and far too acquiescent in the past. In view of the Minister's report, I wonder whether he will get the co-operation he will need from the union. Already, on the basis of the purported report of what the Parliamentary Secretary said, the Scottish miners' trade union has decided by resolution passed at its annual meeting to withdraw its offer of co-operation in regard to pit closures.
I have never been satisfied about a fuel policy being denied us. I always proudly claimed that a Labour Government would give us an integrated fuel policy, which simply meant that the fuel industry would be given a proportionate share of the supply of our fuel and energy needs, and that coal, being the indigenous fuel, would be the basis of that supply. So far, we have not got that. The only solution is a fuel policy, because without one we cannot have a properly planned economy.

6.25 a.m.

Mr. Leslie Huckfield: Since I have neither the extensive mining knowledge of my hon. Friend the Member for Ince (Mr. McGuire), the hon. Members for Orpington (Mr. Lubbock) and for Cheadle (Dr. Winstanley) have departed, and the Opposition can produce only two hon. Members, I shall be rather brief. In this first debate on coal mining since I came to this House, it seems a reflection of the concern of my hon. Friends and the lack of concern of hon. Members opposite that we have such a large number of hon. Members on this side who have been prepared to stay the whole night to express concern about the jobs of 400,000 coal miners.
My hon. Friends the Members for Meriden (Mr. Rowland) and Mansfield (Mr. Concannon) and I represent

areas where miners come when they are transferred from Scotland, Wales and other parts of the country. One of the main problems which the National Coal Board has in Nuneaton is where to stock coal. It is being stocked all over the place and causes great concern to my constituents, but I would rather that the Board stocked that coal than that it should put any of the miners in my constituency on short time. That is why I support this Order.
Neighbouring constituencies represent contemporary problems of the Board in, as it were, a nutshell. We have had some closures, we have natural gas at Hinckley, which is nearby, we have the Bevercotes development and we have a briquette-making plant struggling hard to survive. We also have a large number of transferred miners in these constituencies. The problems which the Board is facing were brought home to me sharply by the closure of a pit in my constituency just a week before polling day in the by-election by which I came to the House. I do not hold it against the Minister, for I was elected, but we suspect that that closing order on one of the few remaining collieries in the constituency must have had some effect on the by-election and showed how miners in a good and prosperous area feel.
Let us not have the idea that only areas in Sotland and South Wales have problems. It is not all an Eldorado or Utopia to which transferred miners are coming. There is the problem of what happens to disabled miners who cannot find work at another pit which has its quota of day-wage men. There is a serious problem for those who find there is no contract work and they have to come down to day work at £13 5s. or £12 5s. Not only is there the closing down of a whole village community such as happened in my constituency, but very serious human problems. One can see proudly displayed in a humble dining room a certificate for 50 years' devoted service. The tragedy was underlined by the fact that the pit which closed just before the by-election had only two years before been guaranteed as a long life pit. This was what the miners who came from the North were told. They were coming down to Haunchwood Colliery, which was supposed to be one of the


pits which had more reserves than most of the others in the West Midlands area. Yet is was closed a week before the Nuneaton by-election. That was what really rammed the point home.
It may be thought that it is all right to be in a receiving area. Some of those who have come from the North and from South Wales are beginning to feel—they have told me this; these are not my words; they are theirs—a little like National Coal Board gypsies. I do not say that in any way as a reflection on their NN ay of life but as a reflection on the way they have been shifted about by the Board. They were moved from the North to Hamstead Colliery. That closed. They were told to come to Haunchwood, which was supposed to be a long-life pit. That closed. Where are they to go, because they cannot all work in the Coventry car trade, which also has its difficulties? Do not let anybody get the idea that there is sufficient alternative work available even in the so-called more prosperous areas.
On the whole, the transfer of Scottish miners to Warwickshire and the East Midlands has gone very successfully. As an indication of this, quite a few of the lodge officials are Geordies or Scots or have come from other parts of the country. This is proof of how well the native community has integrated those who have come in. However, although generally integration has gone well, I do not think that the Coal Industry Housing Association paid half enough attention to the difficulties and to the serious human problems which may arise when people move from a totally different area to the Midlands.
I think of the Coal Industry Housing Association in Bedworth in the heart of my constituency. The people who came to live in this estate came because they saw a very nicely presented glossy booklet from the Board. They were shown a photograph of the shopping precincts of Coventry. They were shown a photograph of the public library in Nuneaton, a very fine building. They were shown pictures of Warwick University. They were told stories of very good primary education for their children and of good public transport—the sort of things they had been used to up in the North.
They arrived in Nuneaton in the dead of night. Nobody met them. When

they eventually found out where they were, they had to wait about four months for a house. Instead of earning some of the wages they had been promised, if they have been unlucky enough to be sent to Cape Keresley—we call it "Cape Kennedy"—after they have had the rent deducted they are lucky if they go home with £8 or £9 in their wage packets. These are the realities of the promises made in the glossy booklet. These are the conditions as they have materialised.
When on top of all that is added the closing of Haunchwood, which was supposed to be a long-life pit, it can be seen that the miners who have been transferred do not feel too happy about it.
There are problems also for an area which is receiving the incoming miners. The West Midlands is supposed to be a prosperous area, according to all the reports issued by the Department of Economic Affairs. However, there are not the alternative jobs for these men to go to after a closure. If we have not got alternative jobs in the West Midlands, heaven knows what it is like in Wales, in the North-East, and in Scotland. We in the West Midlands can see only part of it. I can sympathise with my hon. Friends who represent constituencies in the areas to which I have referred.
I speak, not only on behalf of my constituents, the 4,000 miners I represent, but also on behalf of miners all over the country, because it is the National Union of Mineworkers that we are referring to. We have got to get some problems sorted out. We have to deal with the problem of redundancy and resettlement in a realistic way. Something must be done about the vast differences which exist between the contract worker at the face and the day-wage worker. There are some very difficult problems of transfer here. As my hon. Friend the Member for Derbyshire, North-East (Mr. Swain) said, very often some difficult extra travelling is involved. One has to get up 1½ hours earlier and one comes back from work 1½ hours later. Often it costs extra money in bus fares. We have got to get the whole business of travelling to other pits sorted out.
As my right hon. Friend the Member for Caerphilly (Mr. Ness Edwards) pointed out, one of the things we have


got to do is to get some kind of agency or organisation on the spot to sort out these problems. It is no good leaving it to the existing centres run by the Ministry of Labour, the Ministry of Social Security and the National Coal Board. We have seen in my area, where conditions are supposed to be easier, that this does not work. There must be some other agency to supervise retraining and resettlement. This is one of the matters which I hope my right hon. Friend will look into.
Above all, we have got to realise that this is an industry which is sorting itself out. There are many industries to which in the past we have given some kind of protection. We have introduced tariffs and we have given subsidies. We have had quotas, licences and things like that. In most cases one finds that, despite all the protection that we have been able to give certain industries, like the steel industry, those industries have not improved or modernised or changed.
Here we have an example of an industry to which we have given protection and—my word!—how it has changed. In the past 10 years 300,000 men have come out of the pits and there has been an annual increase in productivity of something like 6 per cent. The Prime Minister said last weekend that if all industry could put forward this kind of record, we could start to sort out the basic economic problems of the country. Given changes like this, I think it is worth giving the National Coal Board a measure of protection. I do not see it as an arm of the Ministry of Social Security, as some hon. Members opposite seem to. I see this as an industry which is genuinely sorting out its difficult problems in an efficient way, and it ought to be given some encouragement.
But one thing has got to happen before this reorganisation can be a real success. We have got to restore confidence to the men who still work in the pits. Many of my hon. Friends have said that they hope the day will come when miners do not have to go underground any more. I believe we all look forward to that eventually, but for the time being men have got to work in the pits, and they have got to have confidence. If we

cannot restore this confidence, we shall be in a very serious situation, and even in 1970 we shall not have the men to produce the meagre targets that we are setting for them.
The problems are serious. The social cost of resettlement is probably somethink like 5s. on every ton. As Lord Robens said to the Select Committee last year, even 1s. 6d. a ton makes a difference. The social problems, therefore, are really burdening the Coal Board greatly.
In view of the reorganisation of the industry, the progress that the industry is making in sorting out its difficulties, the kind of increases in productivity, the example that this industry has been setting and the very serious social problems to which I have referred, I wholeheartedly support this Order. But let us please give the men who work down the pits a target and some confidence. That is what every hon. Member on this side of the House has been asking for.

6.40 a.m.

Mr. Jasper More: I am glad that at this late stage of the debate we have at last heard the voice of the West Midlands. With much of what the hon. Member for Nuneaton (Mr. Leslie Huckfield) said I agree, but I thought it regrettable when he tried at the outset to claim a greater degree of interest in the debate on his own side than on this. It is true that one can look across the Floor and see about ten figures draped on the back benches, but in the West Midlands there are six or eight mining constituencies represented by Labour Members, and the hon. Gentleman appears to be the only one who has taken the trouble to come here tonight.

Mr. Christopher Rowland: Is it in order for the hon. Gentleman to make a remark like that, when it is manifestly untrue? I have been sitting here for most of the night.

Mr. More: I am delighted that there is one other Member from the West Midlands, but that is still only one or two out of eight.
In my constituency we have the problems about which the hon. Member for Nuneaton has spoken. We also have the problem of receiving miners from


other districts, particularly, in my area, from Durham. We have welcomed them, and, on the whole, they have, I think, found a welcome in South Shropshire. They have settled down and they have got jobs, becoming part of our community. But in recent years confidence has gone. This has been the result of the statement of policy regarding the pits issued a short time ago, and even more the result of its implementation.
Experience in my part of the country is that a pit envisaged as closing in ten years has closed in about eighteen months. This has raised a doubt about what is to happen elsewhere. We have one pit, unfamiliar in our part of the country though familiar in many mining districts, which is the only industry and the only raison d'être of a whole community. At present, that pit is listed among those to be preserved, but, obviously, confidence has gone.
The hon. Member for Nuneaton did not sufficiently stress that in the West Midlands area we are not, on the one hand, as prosperous as South Yorkshire and North Nottinghamshire, and, on the other hand, we are not a development area like Scotland, Wales or the North-East. This state of affairs causes special problems, and these problems have been intensified in my area because the pit which is closing is situated in a district which must have a special significance for the two right hon. Members sitting opposite one another across the Floor at this moment. It was the honour and glory of my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) to launch the great Dawley new town scheme. The Leader of the House, who succeeded him as Minister of Housing and Local Government, must sometimes look back regretfully to those happy days, and it pricks his conscience, I hope, to realise that he did not sufficiently follow the efforts of my right hon. Friend in regard to Dawley new town—

Mr. Speaker: Order. This is interesting, no doubt, but, at this time of the morning we would do well to keep to the Order before us.

Mr. More: I am making the point that the colliery was one of the leading sources of employment in the area. It is essen-

tial to have other sources of employment, but they are not being provided. This is the result of Government policy in failing to take a decision on the shape of the new town and in failing to bring other industries in.

Mr. Speaker: Order. With respect, and with a patience which, perhaps, I should not have at this time of the morning, I must ask the hon. Gentleman to speak to the Order.

Mr. More: I support the Order, Mr. Speaker, but I wish that the National Coal Board would so order its affairs as to create more confidence in the different areas. To illustrate what is happening, and what the hon. Member for Nuneaton did not mention, I understand that the whole of the area organisation in the West Midlands is being disbanded, so much so that the chairman of the West Midland area, who recently came to live in my constituency, was apparently encouraged not only to live there but to build himself a house, has now been told that his job is finished and that he must go elsewhere. That sort of thing cannot create confidence in an industry.
With those few words, I give my suport to the Order.

6.45 a.m.

Mr. Michael Foot: I think that the hon. Member for Ludlow (Mr. More) was unwise to suggest that hon. Members on this side of the House have not attended the debate in the numbers they might, since I think that all would agree that representation on this side has been very strong throughout the night. Representation from the West Midlands has also been well maintained, particularly by my right hon. Friend the Leader of the House, who always speaks for the West Midlands on mining matters with his special authority. Therefore, I think that it was churlish of the hon. Gentleman to make that suggestion.
All of us who have listened to most of the debate, as I have, will agree that it has been very good. None of us likes all-night sittings, but those who reflected at the beginning on the disadvantages of this being an all-night sitting might wish to withdraw their remarks at the end, because I believe that the Government and my right hon. Friend the Minister of Power have been given a wider range


of the force of opinion on the subject than would have been possible if we had had a debate throughout an ordinary afternoon. I believe and trust that it will have a substantial effect on the policies the Government pursue.
I do not wish to hold up my hon. Friend the Parliamentary Secretary from speaking, and there may be other hon. Members who wish to speak. Most of what I would have wished to say as representative of what was once a very strong mining constituency has already been said, but although I do not wish to hold up the proceedings for more than a minute or two, there are one or two things I should like to add.
The right hon. Member for Leeds, North-East (Sir K. Joseph) spoke in a non-controversial manner and spirit which no hon. Member on this side of the House could wish to disparage in any way. But it should be acknowledged by hon. Members opposite, perhaps more fully than they sometimes acknowledge it, that if the run-down in this great industry had had to be conducted by private enterprise there would have been ghastly havoc and bitterness on a scale which can hardly be described. It is only because the industry was nationalised and has carried out its heavy redundancies over a long period in a humane fashion, with Government support, that appalling human tragedies have been avoided.
All of us on this side of the House, despite the developments in the mining industry, which many of us have deplored and which many miners have deplored, have every right to say that the decision to nationalise the coal mines has saved this country appalling human misery over the past 20 years. If nationalisation had not happened it could have been a mortal tragedy for our people. We had debates on the situation in the coal-mining industry two or three years ago. I remember my hon. Friend the Member for Aberdare (Mr. Probert), in particular, emphasising that if the Government did not make a clearer guarantee to the industry we should be faced with the fact that there would not be the manpower even to get the target the Government presented. Many of us argued this, as did the National Union of Mineworkers. This was because of the drift away from the

industry and because of the competitive tug of other industries.
In the past 12 months that situation has been somewhat overlaid chiefly by the fact that we have had stagnation in the economy. The fact that we have had no expansion of the economy of any degree in the past 12 months has come to the rescue of the Ministry of Power in one sense. It has checked the drop in numbers, and it has prevented the Ministry or the National Coal Board from having to face some of the problems that we were having to face two or three years ago. But we all trust and assume that the expansion of the economy will be resumed, and the earlier the better. Even if it takes some time, it will undoubtedly be resumed, we trust. Therefore, we shall be faced with a situation in which the pressure on the coal industry from that point of view will at a fairly early date be renewed.
I believe that it will once again be the case that the coal industry will be crying out for manpower, manpower which it will not have. In other words, unless the Government take some further measures beyond those proposed by the Minister of Power in his speech I believe that they will not be able to achieve even the reduced target that has been announced. That will be the real peril. If the fall or collapse in the morale of the industry persists, the Government will not even be able to get their target of 155 million tons. That is what I believe will be the situation.
That would be a very serious development from the point of view of the interests of the nation as a whole, not merely the interests of the coal industry, because it would mean that the Government would not be able to secure from coal the contribution to national fuel resources which they have calculated. So when we are pleading for further steps to be taken to assist the coal industry, we are doing so not merely in the interests of the miners and the coal industry but in the interests of the nation. It is only if the measures proposed by the Government are sufficient to stop the collapse in morale—a difficult job to do—that they will have achieved what they and all of us wish to achieve for the coal industry.
So I tell the Government that they must not rely upon the temporary effects


of the stagnation in the economy because when the expansion is renewed they will have to face a different kind of problem, that of how they are to get sufficient people to produce the amount of coal they will require. That is the major problem. How will they achieve it? Will these measures be enough? If any further argument were needed to fortify the point, I should like to quote from a statement made recently by Mr. Will Paynter, the General Secretary of the National Union of Mineworkers. I add to what was said earlier about the contribution which Mr. Arthur Homer made as General Secretary of the Union in earlier years.
I do not believe that there is any single member of the Government or any single person in the country who could question the part which Mr. Will Paynter has contributed to the welfare of the coal industry in extremely difficult circumstances. He has made many brave speeches to try to assist in building up the strength of the industry. I have heard him on numerous occasions in different parts of the country and at miners' galas putting the view of the union. I do not believe any member of the Government could criticise him for the manner in which he has presented it. This adds to the attention which the Government should pay to the pronouncements which he makes on behalf of his union.
This is what Mr. Paynter wrote in an article in Tribune recently when he stressed the necessity for the Government to take every step they can to fortify the morale of the people working in the industry:
The coal industry is beginning to realise on its investment on modernisation. Productivity is increasing at a rate that outpaces any other major British industry. The Board and the union are examining the possibility of continuous mining operations over seven days of the week in selected pits. But without Government action to stabilise the market for coal the industry will be unable to get full benefit from these new techniques and developments. It is impossible for the union to co-operate in measures to increase product on in existing market conditions, which could only mean more rapid and extensive pit closures and social misery. The continuation of the trend of increased productivity depends upon the morale of the labour force. Further closures and contraction policies can only lower this still further.

What is required is a holding operation to permit stabilisation of consumption, production and the labour force.
I will not go into the further argument elaborated upon by my hon. Friends, comparing the contribution which can be made by different forms of fuel and the calculations which can be made. I am sure that the Minister of Power has learnt from the debate, if he did not know before, that these calculations will be examined in the utmost detail.
The major point, I believe, is the morale in the industry. If the White Paper containing a more elaborate statement of the Minister's policy, which he is to produce in the autumn, were to mark some change in the figure he has announced in the debate, if there were to be some decline in the prospects of the coal industry, and if the White Paper were to contain some fresh blow against the prospects in the industry and some change from the situation, it would have a catastrophic effect. Therefore, the Government must take the firmest possible measures to ensure that the figure which has been pronounced will be sustained and that there will not be any departure from it.
I do not say that the measures are sufficient to sustain the figure. It may be that further measures will be required. If it appears that they will be required they will have to be taken. If there were to be a departure from the latest figure put forward as the one to be sustained, and if it were to be made lower still, the Minister could write off any prospect of building up morale in the industry. I hope that the temper which has been shown in the debate will have an effect on the Minister, as I think it will. The statement the Minister made at the beginning of the debate went some way to mitigate the strong feelings which were rising. But I do not think that he has gone far enough yet. I hope that when we get the White Paper in the autumn it will be a statement to carry out what Mr. Paynter has asked for on behalf of the union and which has been supported by my hon. Friends from mining constituencies in all parts of the country.
What the Minister says in the White Paper is of crucial importance, and on it depends the main point of whether the Government will be able to keep enough


people in the industry to get the coal which is absolutely essential, on the Minister's own reckoning, in the interests of the nation.

6.58 a.m.

Mr. Eric Ogden: This may be an appropriate moment to suggest to the Leader of the House, as a reforming Leader of the House, that he considers the facilities offered in other legislatures whereby members can place their speeches on the record without having to make them at seven o'clock in the morning.
I will declare my interest. I am sponsored by the National Union of Mineworkers, as are many of my hon. Friends who have spoken in the debate. I trust that no one will suggest that being a member of my union constitutes a prima facie breach of privilege.
At the beginning of the debate there was some criticism of the Leader of the House for taking late at night a debate which was expected to continue into the early hours. No one thought it would extend until this hour. I and many of my hon. Friends thought that that criticism of the Leader of the House was unnecessary and unfair. I hope that this is not secret, but there were consultations between the mining group and the Leader of the House and the Minister of Power. We were asking for an opportunity that we tried to get earlier on the Gas (Borrowing Powers) Order and the Control of Liquid Fuel Bill. No hon. Member was forced to stay, but we are not in the position of being able to hold the debate upstairs so we have had to keep some members of the staff here. Perhaps my right hon. Friend will consider for the next Session the advantages of being able to adjourn a debate like this to a room upstairs.
My right hon. Friend the Minister of Power said that this was not just a sterile debate on facts and figures but about the needs, hopes and aspirations of hundreds of thousands of men and women. I am glad that he approached it from that direction. But what he said was an under-estimate. The N.C.B. is the second largest employer of labour in the world and the third largest concern outside the United States, in terms of assets. It is larger than I.C.I., Unilever and B.M.C.

put together. It has 1,250,000 employees and dependents. In merchandising and retailing, 13.000 people are employed; the manufacturers of mining machinery and equipment employ another 100,000. The Board's bill for wages, pensions and salaries is about £450 million per annum. At least 3 million people are effected for better or worse by the fortunes of the Board.
With so much foolish talk of a contracting and declining industry, there is danger that we may look back with some sort of nostalia to the so-called halcyon days of 1913, when production was 287 million tons, or to the 1920s when the industry directly employed 1,200,000 men, and forget the terrible conditions under which these results were achieved. Now the industry produces 175 million tons with the manpower of 400,000, which is still twice the number of men in the British Army.
We should emphasise that the Board has a record second to none for efficiency and productivity, not only at the coal face but in the administrative machinery. Not all of its employees are brawny miners at the coal face. We could not work this machinery without the white collar workers. An organisation created 20 years ago for the administration of the machine was recognised 18 months ago as being no longer appropriate. Then we had the Board, the divisions, the areas, the groups and the collieries—five separate organisations within one overall organisation. This was replaced by three groups—the Board, the areas and the collieries.
In the previous ten years, the Board had reduced the number of its white collar workers by 13.000 men and women—and let us not forget the women who work in the industry. It is estimated that another 13,000 white collar workers will go over the next few years, making a total in ten years of about 25,000 and a saving of £12 million to £15 million per annum. This point is not emphasised often enough, because it shows that there are also difficulties for the clerical and administrative staff as well as for the miners themselves.
All those who have spoken have referred to the need for the industry to be competitive. But there is danger here of looking at the cost of coal simply in terms of 4d. or 5d. a therm. We cannot


measure the cost of coal simply in terms of pounds, shillings and pence or of 0·001d., whether in decimal currency or anything else.
As my hon. Friend the Member for Ince (Mr. McGuire) reminded the House, the cost of coal has been and still is calculated in terms of blood, toil and tears, in broken limbs and sudden death. In 1965, 217 men met sudden death in our pits. In 1966, there was some reduction, for which we are grateful, when 156 men were killed. Injuries are a daily occurrence, and, despite all the improved techniques, new machinery, support rules for roofs and roads, and so on, working conditions are still difficult and dangerous.
It is no great achievement to modernise a pit top with baths and canteens, with coal washeries and handling plant. When one goes back to the coal face, one returns to the carboniferous era and the dark ages. When I think of some of the places in which I worked during the 12 years I spent at Bradford Colliery, I shudder. It was no place for anyone to work, and we must have been slightly road. It must be some consolation to the Whips when we grumble and grouse about conditions here and how difficult it is to get to and from the Palace of Westminster. Some of my hon. Friends have said that it is a bit rough at times, but at least it has a good roof—at least I hope so. We may have difficulty crossing Bridge Street, but we do not have to crawl a mile on our bellies to get to our place of work.
It may be that we tend to forget such things when we come here, but they are the price of coal. I am often reminded of an incident in my time at the pit when I went into the bathroom and found my seven-year old son in front of the mirror with a ballpoint pen in his hand putting blue marks on his back so that he could "be like dad." I am one of the dads in this place who want to get other dads out of the pit and into safer and easier ways of earning an honest living.
In this endeavour, the choice before the House and the country is the same as that before the National Coal Board and the National Union of Mineworkers, and I want to remind hon. Members of a statement by Sir Sidney Ford in his presidential address to the union's annual

conference only a few days ago, in which he said:
In my view we have now reached the stage where we will have to decide whether the interests of our members would be best served by a continuing campaign to bring about some fundamental change in the attitude of the Government and the acceptance of the principle that the survival of the industry should not necessarily depend in the long-term on its ability to achieve price competitiveness, or whether we should concentrate our efforts on obtaining the maximum additional short-term assistance to enable the industry to complete the current plan of reorganisation and to meet the social costs that arise as a consequence thereof.
In view of my own experience, I plump for the second alternative. The Minister has made it clear that his endeavours have been and will continue to be to ensure that not only is coal produced but that the maximum amount is sold. He has initiated plans to distort the natural pattern in favour of coal consumption and against oil, gas and nuclear energy.
We on this side of the House all welcome—and the right hon. Member for Leeds, North-East (Sir K. Joseph) gave it a qualified welcome, for which we are grateful the decision to require the C.E.G.B. to use an extra 6 million tons of coal, but I think that we want spelt out in rather more detail how the intention is to be carried into operation. We would like more information about how the gas industry is to carry its share of the burden. It seems to be economic madness, in the same month as we have a Control of Liquid Fuel Bill, we have a 25 per cent. increase in fuel burned in the south-east estuarial power stations.
Every little helps, however, and British Rail can carry a share of the burden by slowing down conversion from coal to oil. Industrial organisation, too, could be asked to defer conversions from coal to oil in the national interest. The C.E.G.B. should certainly be given the right to provide two new coal-fired stations in each five-year programme. This would be a major source for the coal industry.
At the beginning of the debate, we were glad to have the presence of my right hon. Friend the First Secretary of State and his assistants from the Department of Economic Affairs, because they also carry a heavy responsibility for what is happening in the development areas. I hone that some of what we say will be


communicated to them. The Department of Economic Affairs and the Treasury must reconcile their differences and accept the logic that the Coal Board should benefit from the same Selective Employment Tax advantages as other manufacturers in development area. It is crazy that someone manufacturing candy floss in the Merseyside development area should receive a subsidy of 7s. 6d. or 30s. a week for an employee whereas someone who leaves West Derby and goes slightly outside the area to Cronton Colliery or Bold Colliery should be denied that benefit.
There have been numerous references to North Sea gas. To burn almost pure methane to produce electricity is a colossal waste of natural assets. I suggest that my right hon. Friend the Minister should not put all his bets on nuclear power as being viable on present forecasts. Certainly, Seaton Carew should be a coal-fired station, and we could make a strong case in Lancashire, without bringing in the Midlands and Yorkshire, for the new station at Heysham also to be coal-fired. By making that one decision, the Government would save £78 million capital outlay as against the cost of a nuclear station. That is a serious consideration.
At last, the Government recognise that subsidies by a Labour Government for a nationalised industry are not a naughty thing, and the Opposition also recognise that. It may be that we should have a study to find which is the most economic way of helping, whether to provide redundancy payments, advance factories, S.E.T. repayments, retraining and all the rest. It might in the long run be cheaper to pay a subsidy of 10s. a ton.
Estimates of stocks have varied between 30 million and 60 million tons. We are exporting 3 million to 6 million tons per annum. At the same time, it might be cheap and good business, as well as being very moral, to give some of it away. I do not know how we would get it to Zambia, but that country would welcome it. We talk about providing desalination plants in the Middle East. The Americans have a good record in desalination plants, which are small and convenient but not very cheap and which use coal. If we could provide such a plant for Jordan

and one for Israel and send the coal at the same time, we would reduce our burden of storing it in England and it might be a good way of easing the position.
Now, a quick word on personnel. The House will welcome the decision to provide the beginning of pensions at the age of 55. Even though they are to be contributory, this is a beginning of the recognition of the different conditions in the industry.
I am glad that the House has confirmed its interest in these matters. We have heard not only from union-sponsored Members and others from coal areas, but from Members representing all areas. I have no doubt that my right hon. Friend the Minister is well aware of the industry's problems. He has proved this on many occasions in past months. The problem has now gone beyond his Department to the Cabinet. The Cabinet must show that it recognises the problems which we recognise and is prepared to give us at least a much greater degree of support than it has been able to give in the past.

7.15 a.m.

Mr. Christopher Rowland: I apologise for speaking at this hour, when it is too late to go to bed and a fraction before the working day starts, but I do so because, like some other Members, though I am not a N.U.M. Member, I have some half dozen pits and several thousand miners and their families in my constituency, and to this extent I am as much concerned about and interested in the future of the coal industry as any hon. Member who is identified as a miners' M.P.
Last night we had from the Minister the announcement of half a national fuel policy. I wish that it had been possible for my right hon. Friend to have circulated his statement in advance, because there are many questions arising from it which I would like to ask, and we have all been put in the difficult position of having almost to take it down in such shorthand as we possess to enable us to make an intelligent speech about what he said. There are some questions which I would like to ask my right hon. Friend through the Parliamentary Secretary. I do not necessarily expect answers in a few minutes, but they are questions to


which I am sure we would like answers over the coming months.
We have been told that the output which is aimed at in the immediate future is 155 million tons, though initial calculations suggested something over 140 million tons. I gather that the shortfall is to be met by 6 million tons increased consumption in the electricity and gas industries, but I would like to know where the other 9 million are supposed to come from. How long will this figure of 155 million tons be held? Is it dependent on no increase in stocks above a certain level? How much is the maintenance of this figure likely to cost the taxpayer?
Perhaps a more serious figure, and one which I am sure will reverberate round the coalfields, is the projected possible figure of 120 million tons in the mid-1970s. I would like some assessment by the Ministry of whether this figure is the absolute rock bottom to which the industry might go. Unless this kind of assurance is given, the whole problem of morale will be made even more difficult.
Is there any risk, as my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) mentioned earlier, that these figures, either of 155 million in the immediate future, or 120 million in eight or ten years from now, will be revised downwards even within the next six months before the Government's total fuel policy is announced? If so, it would have been better to have given a lower figure today, rather than delay it for a few months. Does the Board accept these figures? I understand that Lord Robens is to make some pronouncement today on last night's announcement by the Minister. Perhaps I shall receive my answer fairly soon. We should be told how far there has been some reconciliation of viewpoint between the Ministry and the industry on this matter.
In some ways the only major consolation which miners on the ground and underground will receive from last night's announcement is the statement of increased help for redundant miners. I am not entirely clear, though, but perhaps I did not take it down properly, whether this is to be for disabled redundant miners, or for all redundant miners over 55. Is there any possibility of there

being some retrospection in this matter? It will be very hard if we have a situation in which any miner will benefit as from today from last night's announcement, but any miners who were made redundant in the last 3, 6, 2 months will not. I can foresee a good deal of legitimate grievance in the mining communities about this matter. Can we have some indication of how much this proposal will cost?
On the other hand, there are many consolations which were not offered by the Minister. The one which I would have liked to have heard was some assessment by the Ministry of whether the coal industry can, by one figure of output or another, eventually pay its way, either by a combination of increased productivity and sales, or by a further write-off of some of the capital of the industry. The men need to know what is expected of them and their machinery.
Perhaps the Ministry does not know whether the stocks will be run down but this is an important factor. And what about other possible markets? The Homefire plant making smokeless briquettes in my constituency is having teething troubles. What are the prospects for this important development?
Morale is a problem even in the relatively prosperous West Midlands. The Minister will recollect a recent pit closure in my area, because he was challenged on it during the Nuneaton by-election. Rumour licks at the reputation and future of other pits in the district. In the minds of some, there is uncertainty about whether the A, B and C categories of collieries still stand. Could these categories be confirmed or revised? In areas like mine, jobs for miners transferred from the North-East or Scotland have disappeared. Men who have lost contract work cannot get equivalent work in neighbouring pits and the new national agreement does not yet deal with this fully. Travel to other pits is sometimes difficult, anyway. It is difficult also to attract school leavers.
Uncertainty is the sapper of morale, as my right hon. Friend the Leader of the House, an expert in psychological warfare, would recognise. Although not with us now, I give him credit for the fact that he has been here most of the night, though I have some doubts about Cabinet Ministers being up all night.
Miners do not know who to believe about the envisaged output—Lord Roben's assessment to the Ministry or experts' hints about Ministry thinking which has not been vouchsafed to us yet. If people knew the worst, they would face the situation better. This is easily forgotten in London. I weary of the pundits' blithe references to one closure a week, as though it were pre-ordained. Will this rate be stepped up under the new output proposals? It is now a larger proportion of collieries than it was a few years ago. One out of 1,000 is very different from one out of 400.
"Responsibility" tends to be a euphemism for lack of imagination, particularly in the south of England. If a Royal Commission recommended a reduction in the number of seats in the House of Commons by 200—and it could be argued that there are too many in comparison with other legislatures—we would not view that with the equanimity and impartiality with which we expect miners to view the closure of their pits and the rundown of their industry.
In my constituency the N.C.B. is preparing a revised application—I understand that it has not yet been made—for a considerable amount of opencast working in an area which has already suffered it. It is difficult to jusify to the public further extensive opencast working when they can see with their own eyes the stockpiling of coal that has come from underground.
I appreciate the economic argument—that opencast is the cheapest form of coal extraction—but it is difficult to explain to people that it is necessary when underground coal is being stockpiled. It may be cheaper. If it is, we should be told how much cheaper it now is and how its average production costs compare wih the marginal production costs of the most efficient deep mined pits.
We have discussed the social costs which arise from the closing of deep mined pits and we have been told that the Government intend to bear some of these costs. But there are social costs involved in opencast mining as well. The Minister has extraordinary powers of decision in this matter and can decide whether N.C.B. applications should be approved.

He should, when making these decisions, set against the economic advantages of opencast this social cost factor in the way he rightly does when considering deep coal mining.
In the last few years the coal industry has had a remarkable record of increasing its productivity and decreasing its labour force. The railways, another nationalised industry, are the only other one to show a comparable drop in the number of people employed; and in both cases the reduction has been carried out with remarkable skill, due to co-operation between management and unions.
I look forward to seeing the coal industry as part of the nation's efficient supply of four fuels. Lord Robens is right to be fighting like a tiger for his corner. But I recognise that my right hon. Friend is the Minister of Power and not only the Minister of coal and that he must make a balance between the different fuels.
Looking beyond the coal industry, we have the good fortune to be among the leaders of nuclear power and to have discovered natural gas in the North Sea, perhaps the only lucky break this country has had since the war, though it may not be a lucky break for the coal industry. I hope that, combined with these two fuels—plus such oil as we decide to buy—in the coming years we will have the good fortune of a stabilised, efficient coal industry. In so far as the Order helps to achieve this I support it.

7.29 a.m.

Mr. Michael Alison: This has been a long debate and many speeches have been made. It would be tedious if I were to mention all that have made an impression on me, but I wish particularly to mention the remarks of the hon. Member for Dearne Valley (Mr. Edwin Wainwright), who emphasised the oil hazards in the Middle East, the enjoyable speech of the hon. Member for Ince (Mr. McGuire) and the interesting comments of the hon. Member for Mansfield (Mr. Concannon).
Many gems have glittered in tonight's speeches. I thought the nugget appeared in the Minister's statement—and this point has not received the attention it deserves—when he announced the crucial figure which is the whole explanation for this long night's debate. He announced


that 155 million tons was the new coal target. When I think of the number of speeches we have heard, I am surprised to realise how little this figure has been discussed and questioned. I at once make an honourable exception of the hon. Member for Meriden (Mr. Rowland), who spent a little time analysing it. The hon. Member for Ebbw Vale (Mr. Michael Foot) conducted a sort of rearguard action on the figure and took the line of "Thus far and no further". But I certainly am surprised that the Minister should have been let off so lightly with this target figure of 155 million tons.
In retrospect, it is most extraordinary, and I suspect that one reason for it may have been the very presence of the Leader of the House as adviser on psychological warfare. If one starts with a figure of 140 million tons and then says, "You have been very good—we will put it up to 155 million tons", everyone heaves a sigh of relief and thinks "Half a loaf is better than no bread". Nevertheless, the right hon. Gentleman should not be allowed to get away with that figure without some analysis of it. One of the things that has surprised me is that so many hon. and right hon. Members opposite have accepted 155 million tons without even advancing a suggestion of a 5 per cent. or 10 per cent. increase on it.
A lot of thought and energy has been devoted to criticising the nuclear power programme, but would hon. Members opposite be satisfied if the likely coal equivalent in nuclear power by 1970—which is not more than 10 or 12 million tons as far as one can see from the White Paper on Fuel Policy—was totted on to fie 155 million tons, bringing it up to 165 million or 170 million? Would that be a satisfactory figure? For many hon. Members I do not think that it would, because they will no doubt remember that the previous Minister of Power, the right hon. Gentleman the Member for Newton (Mr. Frederick Lee), had some very firm things to say about the target only as recently as 25th November, 1965.
Moving the Second Reading of the Coal Industry Bill, the right hon. Gentleman then said:
When one hears some of the arguments adduced about what will happen to the coal industry if its target is only"—
and one marks the word "only":

170 or 180 million tons, I invite the House to remember that it would still be about the biggest coal industry in Europe.
So there is the Minister of Power in 1965 fighting a rearguard action on 180 million tons. And the extraordinary thing is that at that time the right hon. Gentleman the Member for Newton said:
… if the industry or its products were to fall below the figures"—
that is, 170 million or 180 million tons:
which we put in the White Paper, I would then become worried on balance-of-payment grounds."—[OFFICIAL REPORT, 25th November, 1965; Vol. 721, c. 781.]
Today there has been a complete reversal of that statement by the Minister, who said that the figure would have to be under 155-odd million tons. So the figure of 155 million tons has not been given much scrutiny or analysis, and I think that we have all let the Minister off far too lightly.
Let me now look at what Lord Robens has done about the figure, because he is, in many ways, the great authority. On looking at his comments. I find that if one tries to analyse the Robens position on total tonnage he is a sort of two-ended animal—a push-me-pull-me animal. In a way, there is Robens the realist and Robens—I do not know whether to call him the optimist or the publicist, but they are two different animals. Let me remind the House of what Robens the realist thinks the target should be.
He had something to do with the report of the Prices and Incomes Board on the prospects for the coal industry when the P.I.B. was examining whether or not he should be allowed to charge more money. He supplied Mr. Aubrey Jones with all the facts and figures, and we find a useful breakdown—and here I refer to paragraph 52 in the famous report on coal prices—of that portion of coal production which is profitable and that portion which is unprofitable and which loses money. If we tot them up, we find that the tonnages of coal produced profitably came to exactly 120 million tons and the balance was all produced in areas making losses of between 5s. and practically 13s. a ton. Here we have a nice figure in the prices and incomes evidence of 120 million tons, which is what the Prices and Incomes Board considered a viable figure. I ask hon. Members to mark this figure of 120 million tons, because this has to do


with Robens the realist. When he came to the Select Committee on Science and Technology, on 15th June this year he used these words:
If the London price of gas is somewhere about that,
He used the figure of 3d.—
that means that this is as cheap as national gas. In total there is about 120 million tons at round about 4d. a therm. We think we can get this down.
Here is Robens the realist repeating the figure of the profitable competitive amount of coal, 120 million tons. Lest it be thought that he always wants to temper his realism, at the same visit to the Select Committee he made it clear that he was not interested in subsidy or protection. He said:
I am completely against subsidising it and I am utterly against protection as a long-term measure.
This is Lord Robens making quite clear that the viable figure for the coal industry was 120 million tons and he was against protection, which must mean that he supposed that the ideal for the industry would be about this level.
Lord Robens went on to make clear that the whole of his policy in the Coal Board was towards using the £80 million odd that he will have to support the industry through redundancy measures and so on down to this lean and slim figure which he regards as a viable size. How is it that it has been brought up from 120 million tons to 155 million tons? If one believes in slimming the industry so that the unprofitable mines are cut away and one is left with a viable industry, one will be able to concentrate management and capital resources on the viable part by which one can get an increase in production. If the industry consists of the viable 120 million sector, how can it be increased to 155 million tons?

Mr. Varley: I followed Lord Robens's arguments very closely. Surely what he has been arguing recently has been that it is a question of time. One cannot close pits any faster than at the moment—one a week. To close them more quickly would mean not only great hardship to the men working in the industry, but great strains on management.

Mr. Alison: There may be something in what the hon. Member says, but he

cannot have it both ways. Lord Robens cannot talk about a viable industry and at the same time attack the nuclear power programme, which is quite irrelevant in this context. This is where Lord Robens the publicist is so difficult to understand. Having made quite clear that the figure for a competitive industry is 120 million to 150 million tons, which he can manage and make a profit on, there is no point—it is meaningless—in attacking the nuclear programme which in 1975 will be producing a coal equivalent of 10, 12 or 15 million tons. If he adds the 15 million tons, he is still no nearer the old target of 180 million tons. This attack on the nuclear programme is irrelevant. It is a distraction. He is trying, for reasons best known to himself, to divert the attention of the coal mining community and of the public from what should be of much more crucial concern for us, namely, the question: having got his slim industry of 155 million tons, how can he increase sales?
I believe that he could. A question asked by my hon. and gallant Friend the Member for South Fylde (Colonel Lancaster) and to which we have not yet had an answer—I hope that the Parliamentary Secretary will answer it—was: if the coal target of 155 million tons leaves a viable going concern as a coal industry, this is only a starting point, and what about exports? Where is the scope for increasing exports? The first point then is: can the price of coal be reduced? If it is 158s. a ton plus at present and the industry is to be slimmed, can we expect a price reduction? This is the first question.
If there is to be a price reduction, what about doubling the export target? Nothing has been said about targets? In the National Plan it was 5 million tons. They managed to export 6 million tons in 1964 with a very unecomonic mining unit. If we are to get a competent, slim, lean, industry, why not aim to double coal exports from 5 million tons to 10 million tons or even to increase them to 15 million tons? Then we would be up from 155 million tons to 170 million tons straightaway. Nothing has been said about the potential for building on this figure of 155 million tons. Everybody accepted it. The hon. Member for Ebbw Vale fought a rearguard action on it, his attitude being, as I thought, "Thus far and no further". There was


no sort of idea that this might be the launching pad or jumping off point. If the industry is to be a modern, modernised, capital-intensive, profit-making industry based on an output of 155 million tons, why not regard this as a starting point and not the ending point? This is what we want to hear.
Will the price come down when we get this slim, lean, industry which the Government are spending so much money to acquire? Can we expect a real increase in exports? We want to know this, because far too little attention has been paid to the scope for regarding 155 million tons as the base and the beginning and not the end. Those are a few questions on which we want to hear answers. Can we expect this to be a base figure to be increased? Will the price of coal come down?
I must touch on something else which fills us with a real sense of criticism about the way the Government have presented the case tonight. Although the figure of 155 million tons has been rather tamely accepted by right hon. and hon. Members opposite, I believe that far too little critical appraisal has been given to the social measures which the Government have handed out at the same time. What the right hon. Member for Newton gave us in November 1965 was a cut-back of the coal target from 200 million tons to about 180 million tons. In doing that he spent a whole day giving us a new Bill handing out £30 million of Government money and making a most far-reaching pronouncement on what he would do.
Today the Minister gives us a far greater chunk of surgery on the coal industry, a cut-back from 180 million tons to 155 million tons at the very least, which is a far bigger slice off the industry than we had in November, 1965. Yet he told us nothing about the amount of money which will be available. At least the right hon. Member for Newton gave us £30 million. Are we to be told a figure tonight? What in terms of hard cash will be available for the extra pensions, the supplementary redundancy payments, and all the rest? We want a hard figure. It must be at least comparable with, and should in practice be much more than, the £30 million we were promised in 1965.
Finally—I apologise for leaving it to this rather late moment—I want to ask

one or two technical questions on the famous Order itself, which has received almost as little attention as the new target figure. Is the extra borrowing power, which the Parliamentary Secretary will soon be discussing with us, all to do with coal stocks, or will it also cover other expenses? Can he quantify precisely the cost of the coal stocks for us? Secondly, if it is not only to do with coal stocks but will cover other items as well, what are those other items? Does it represent extra payments for accelerated closures? Does it represent subsidy towards operating deficit? One of the matters that we discussed recently was the permission given by the Prices and Incomes Board to cover a deficit of £80 million. We would expect there to have been a deficit this year. Is this extra borrowing power concerned with a possible deficit?
We ought not to let the Government get away with this plea that the National Coal Board, through no fault of the Government, is carrying these enormous stocks. It is the fault of the Government. This is one of the reasons why there should be a general far-reaching debate on the coal industry's future. Coal stocks are obviously a demoralising phenomenon, and it is due to the Government. It is due to the cutting of the growth achieved by the Tories in 1964, and the steady decline first of 6 per cent., then 4 per cent. and 3 per cent. No wonder coal stocks have grown. They will soon disappear when the economy starts growing again. The Government should subsidise this themselves and should not try to force it on the coal borrowing powers.
We have a far-reaching debate. I believe the Minister has got away very lightly with his new figure, and I believe that he has done it partly as a confidence trick. He gives a figure of 140 million tons and then increases it to 150 million tons and says "What lucky boys you are." We look forward to hearing a full appraisal of the whole of the debate from the Parliamentary Secretary.

7.47 a.m.

The Parliamentary Secretary to the Ministry of Power (Mr. Reginald Freeson): Despite the somewhat unfortunate phraseology of the latter remarks of the hon. Member for Barkston Ash (Mr. Alison), I think it will be fair to start by saying that this has been one of the


most wide-ranging and comprehensive debates that I have experienced in this House on one topic, and certainly it is a debate to which more speakers have contributed than in any other. I think that, including myself, 34 Members have spoken in this debate. I do not know that I have ever experienced a debate of this kind before. It has certainly been an excellent one.
The first point I should make is that my right hon. Friend's main purpose in making a preliminary statement on fuel policy at this stage—and it is only a preliminary statement—was to sound out hon. Members and give him an opportunity of hearing wide-ranging views and reactions to the statement, which can be borne in mind between now and the actual publication of the White Paper in October.
Quite a number of the points which were raised by the hon. Member for Barkston Ash are ones which must necessarily be followed up in the White Paper. Similarly, most of the questions which were put by my hon. Friend the Member for Meriden (Mr. Rowland), as I think he will appreciate, must be dealt with in relation to the White Paper, and most of the others are questions which would be best directed to the National Coal Board rather than to the Minister. We shall certainly read the Official Report, and if there are points that we can follow up specifically we will certainly do so.
I do not think anybody will bless me if I speak at length in answering even a small percentage of the points which have been raised during the course of this prolonged debate, but I will attempt to deal with some of those which I have noted down.
I have been asked to state the purpose of the extra borrowing. It is concerned primarily and mainly with stockholding, but to some extent with the acceleration of closures and the redundancy payments which flow from them. The sum involved relates solely to those matters.

Sir K. Joseph: The hon. Gentleman has not dealt with the point that the Minister's predecessor, in November, 1965, expected that £750 million would last through to 1971. Is the hon. Gentleman saying that it is just the extra 12

million tons of stock which explains the change in the Minister's prediction?

Mr. Freeson: No. The point is that, if there is a different figure and a higher rate of run-down, as has occurred since 1965, that leads to greater expenditure over a shorter period. Without going into detail, that is the general answer on that point.
The wide ranging points which hon. Members have made will be noted and borne in mind when the White Paper is prepared, but, in that context, I must refer to the tendency, understandable in the circumstances—no one belittles the anxieties which are felt about the future of the coal industry—to unduly talk down the industry. It is understandable, but it can do a great deal of damage to the industry. Whatever the realities will be following the White Paper, it is my right hon. Friend's view and mine, and the view of the whole Government, that the coal industry will remain of prime importance in the country's economy. This must constantly be borne in mind.
There is also a tendency, again understandable in the present state of uncertainty and anxiety about the industry, to think of the Government's policy as one to run the industry down. On many occasions, both in the House and elsewhere, my right hon. Friend has stated that it is the Government's policy—this was clearly indicated in the preliminary statement he made today to control the run-down, so that it is properly phased down, not letting the market trends just carry the industry in an uncontrolled fashion down to a low level of production and sales.
This brings me to the figure which, quite rightly, has been made much of in the debate, that is, the 155 million tons. The hon. Member for Barkston Ash has misunderstood the basis of this figure. It is not a target. My right hon. Friend has made this quite clear. The Government are seeking, by various measures and in consultation with industry, particularly the electricity industry, to push up the coal burn to the 155 million ton level, above what was originally estimated on the studies of trends to be 140 million tons. That figure of 140 million tons was revised upwards on the basis of further studies.
We want to push up the coal burn in order to cover the period between now


and the early 1970s, the key period of transition to which so many hon. Members have referred and about which the National Coal Board is concerned, in order to ease or control the rate of phasing down and reshaping of the industry. That is the purpose of the figure of 155 million tons. It is not a target figure. It is in order to ease the transition period between now and the early 1970s. I stress that the Government are seeking to keep the level of consumption up in order to make it easier to phase the industry and reshape it to the context of the 1970s.

Mr. Lubbock: Will the Minister achieve this by asking the Central Electricity Generating Board to alter the order of merit as between coal and oilfired stations? If so, can he say what saving of oil imports there will be for the balance of payments?

Mr. Freeson: I do not wish to quote from my right hon. Friend's speech, but this is exactly the opposite to what he said last night. He said that the objective would be to enable the C.E.G.B. tinder the new arrangements to present its case for various power stations on their economic merits.
How the electricity industry will be assisted financially is a matter that has still to be worked out in detail. But the point my right hon. Friend made was that the community at large, by way of the Exchequer, would be required to pay for the assistance. The burden would not fall either on the coal industry or on the electricity consumers. There will be economic comparisons, but the cost will be met from public funds.
Some hon. Members wanted more detail, and felt that a speech last night was not the right way to present the policy to the House. But it must be remembered that this was a preliminary statement. My hon. Friend indicated that the details are now being worked out in consultation with the industries and other Departments concerned.

Mr. Edward Milne: I am sorry to interrupt my hon. Friend at this stage, but surely the point he is trying to make is that the industry's output is not being raised from 140 million tons to 155 million tons, which is the figure my right hon. Friend gave, but is

being reduced to 155 million tons. If he is arguing that it is being raised, does that mean that the coal-fired power station in the Durham coalfield has received my right hon. Friend's consideration?

Mr. Freeson: I cannot be tempted to comment on what my right hon. Friend's position may eventually be on the future power station programme as between coal or nuclear power. The point that I must stress is that this is not a question of the Government's reducing coal consumption. It is a question of the Department's studying what is happening in the fuel industries, seeing certain forecasts over the next three to four years, and the Minister's saying, "This is not satisfactory. Too many difficulties will be created for the coal industry if these trends continue at that level, reducing demand to 140 million tons"—or however many tons it is—"We must keep the coal-burn above that figure so that the run-down can be properly controlled and planned."
It is not a Government decision that consumption should decrease to about 140 million tons, or whatever the figure would be, as dictated by the market trends. It is the Government's decision to try to get the coal-burn above that figure. One must qualify by making the important point that the Government do not run the industry—organise productivity or market coal. The actual figure of consumption will depend on the rate at which productivity is increased and. on the other side of the coin, the rate at which markets can be expanded. This cannot be dealt with solely by means of consumption at power stations. There are other spheres of marketing that are also important.

Mr. McGuire: I am grateful to my hon. Friend for giving way, and I do not wish to delay him too much, for he has waited a long time. But, inherent in all the White Papers and previous discussions has been the fundamental fact that the numbers in the mining industry are closely tied up with the electricity industry's taking a great and growing share of the coal produced. I hope that my hon. Friend will answer the question of how we can say that the Government do not influence this when no coal-fired stations are planned beyond Drax. It does not matter what is produced, if the


main market is taken away it is the end for the coal industry.

Mr. Freeson: I shall be coming to this point as I proceed. I have jotted down references to the A.G.R. programmes which were made by various hon. Members, including my hon. Friends the Members for Midlothian (Mr. Eadie) and Ince (Mr. McGuire) and my right hon. Friend the Member for Caerphilly (Mr. Ness Edwards).
First, with reference to the criticisms levelled outside the House and in the debate about the A.G.R. programme, one needs to say that, whatever views there may be about the programme or the history of nuclear power in this country, it will have no effect on the future of the coal industry in the transitional period between now and the early 1970s. In this respect one agrees with the hon. Member for Barkston Ash. This is the situation with which we have recently been concerned in Questions and Answers in the House and in debate in the House and elsewhere.

Mr. Eadie: I am obliged to my hon. Friend for giving way; he is showing tremendous patience. Surely he must agree that it is not irrelevant for the Government—the Government decided this policy—that more than £500 million in addition to what could have been the cost of conventional coal-fired stations was spent on nuclear power? We cannot sweep this under the carpet.

Mr. Freeson: I have no intention of sweeping anything under the carpet. There is a misunderstanding here. I was referring to criticisms of the A.G.R. programme, of which we have seen a great deal over the last few months. Whether they are right or wrong, they do not affect what happens to the coal industry between now and the time when the stations are built. This is the critical period for the coal industry. This has been the burden of the debate. It is about time that we made the point clear and argued it as a separate issue but not in reference to what is to happen to the industry over the next four or five years. In fact, I think that 1975 would be a year in which it would have no relevance to coal consumption.
I was asked a few moments ago what the Government were doing about ex-

panding coal consumption for electricity generation. It was suggested that we were not doing enough and in some circumstances it was suggested that we were not doing anything. But about 20,000 megawatts of conventional power station construction is under way now—that is, for coal burning—compared with 8,000 megawatts in the nuclear programme. The figures speak for themselves. The constant reiteration that everything is being put into the one basket of the A.G.R. programme at the expense of coal burning is not in line with the facts. There is under way at this moment 20,000 megawatts of conventional power station construction.
References were made to natural gas consumption and the fact that this would be harmful to the coal industry if brought into use in power stations. Two points need to be made. First, the conversion at Hams Hall is an experimental project to acquire technical experience in converting to natural gas consumption at power stations. Secondly, in so far as natural gas is absorbed into power stations and into industry generally in this bulk fashion it will essentially compete with oil and not coal. Obviously there will be some repercussions right down through the economy, but in so far as there is direct influence on public industries it will be in competition with oil rather than coal.
A point to be borne in mind about natural gas in relation to coal is that the 1,500 million cubic feet out of the 2,000 million cubic feet expected to be coming on shore by 1970 or soon after will replace traditional or conventional gas supplies—town's gas—and the competitive problem of further absorption will be the 25 per cent. Remainder—500 million cubic feet—which will also be available on shore by that time and will need to be absorbed into the system. I do not want to pursue the point in detail. The rate of absorption is of direct relevance to the gas price negotiations which are still in train.
There were various references, naturally enough, to the assistance being given to the industry for the elderly and disabled. The Minister has indicated in his statement what the general desire and intention of the Government will be. The proposals have yet to be worked out in detail and they will be presented to the


House in the White Paper. I was intrigued by the suggestion of the hon. Member for Yeovil (Mr. Peyton), who is not here now. He made a very un-conservative suggestion of splitting the industry, as it were, down the middle, keeping the prosperous parts under the N.C.B. and putting the wasteful or unprofitable parts under a Government Department such as the Board of Trade and the Government would run that part as an unprofitable undertaking. It is an interesting idea, and it would be more interesting at some future date to hear the hon. Member expand on his untypical proposal.
On the question of assistance for the elderly and disabled and retraining, an approximate estimate has been made—and at this stage it can only be an approximate estimate—that with the pushing up of coal-burn by another 6 million tons per year, there will be additional expenditure or assistance to the coal industry amounting to as much as £40 million or £50 million over the next three or four years. We have to see how this will work out in detail, but it is the kind of picture which is presenting itself at the present time. These figures should be borne in mind.
The essential point is to give assistance during a holding operation in order to assist the transition in the industry and thereby to assist morale and to make it clear that we see a future for the coal industry—a properly reshaped and modern industry—playing an important part in the economy. This to us is the best way of keeping up morale in the industry.
If there is a realistic and confident approach to the future of the industry it can take its place as part of the four fuel economy in the years to come. We will not assist morale in the industry by pretending that the situation is other than what it is going to be. We have to face realities and organise the industry as best we can in the face of these. That is the way to build up and maintain morale. There is no doubt there should be a proper future for the industry.
Some references were made to the effect on the railways. My hon. Friend the Member for Midlothian asked whether there had been consultations with the British Railways Board. I can assure

him that there has been such consultation. Sir Stanley Raymond, the Chairman of the Railways Board, has attended a meeting of the Minister's Energy Advisory Council and the Railways Board and the Coal Board are maintaining close contact over estimates of future traffic flows.

Mr. Alison: While the hon. Gentleman is on the question of future morale, will he agree that morale will be most firmly based by being put on the basis of the possibility of a new coal industry, reducing prices, becoming more competitive and exporting more?

Mr. Freeson: Clearly that is the objective of the industry and there is no need for any Minister to say that it is. The industry has a first-class record in this respect. The Board has no need for any shame. It has a fine record, as has every other publicly-owned industry, in increasing productivity. It is unfortunate that a good deal of the efforts of reorganisation and modernisation in the industry will be made more difficult because the final stages of this process are clashing with a new situation developing in the fuel economy.
It is with this problem of transition, with the advent of natural gas and the prospects of nuclear power, that we must concern ourselves. But the industry's record of productivity and modernisation is good. It is the objective of the Board, and of the Government, to increase productivity and capacity and to sell competitively in the home markets and also abroad if that is possible.
One must not talk about exports too glibly. As my right hon. Friend said, the situation we are facing in Britain is also being faced by the other countries of Western Europe. But it is to Western Europe, obviously, that our main export effort has to be directed. It will not be an easy proposition, since the countries of Western Europe have similar problems to ours concerning the sale of coal. However, it is a prospect which must be followed up.
I have tried to deal with the main themes of the debate, and I do not wish to delay the House any longer. It is very late. We have had an excellent debate, and the Government will study the record with great care, bearing in mind what


has been said in preparing the White Paper for October.

Question put and agreed to.

Resolved,
That the Coal Industry (Borrowing Powers) Order 1967, a draft of which was laid before this House on 26th June, be approved.

ADJOURNMENT

Resolved, That this House do now adjourn.—[Mr. Armstrong.]

Adjourned accordingly at twelve minutes past Eight o'clock a.m.